Objective: To test associations between parental drug abuse and children's problems, children of cocaine- and opiate-dependent parents were compared with demographically matched referred and nonreferred children. Method: Cocaine-and opiate-dependent parents in treatment completed the Child Behavior Checklist for 410 children (218 boys, 192 girls) from ages 2 through 18 years (mean = 7.9 years). Children of drug abusers (CDAs) were demographically matched to referred (RCs) and nonreferred children (NRCs). Results: RCs scored lower than CDAs and NRCs on most competence scales, and higher than CDAs and NRCs on all problem scales. CDAs scored lower than NRCs on most competence scales, and higher than NRCs on Withdrawn, Thought Problems, Delinquent Behavior, Aggressive Behavior, Internalizing, Externalizing, and Total Problems, Group status also predicted clinical range scores on most competence and all problem scales. Conclusions: CDAs showed more internalizing and externalizing psychopathology relative to matched NRCs, but they showed significantly less psychopathology than shown by matched RCs. CDAs are an important group to target for preventive interventions.