The relation between perceived racial discrimination and substance use was examined in a panel of 684 African American families, using the prototype-willingness model of adolescent health risk (F. X. Gibbons, M. Gerrard, & D. Lane, 2003). Discrimination was concurrently and prospectively related to use in the parents and the children (mean age=10.5 years at Wave 1). The discrimination-->use relation in the parents was mediated by distress (anxiety and depression). Among the children, the relation was mediated by distress as well as their risk cognitions (favorability of their risk images and their willingness to use) and the extent to which they reported affiliating with friends who were using substances. Each of these relations with discrimination was positive. In contrast, effective parenting was associated with less willingness and intention to use. Theoretical and applied implications of the results are discussed.