Guided by the integrative model (García Coll et al., 1996), this study examines prospective associations between perceived ethnic discrimination by peers, parental support, and substance use from 7th to 11th grades (Mage = 12.3–16.3 years) in a community sample of 674 Mexican-American adolescents. Results from a cross-lagged panel model indicate that discrimination predicts relative increases in adolescent substance use. Results also revealed a transactional relation between substance use and supportive parenting over time. Supportive parenting was associated with reductions in substance use, but adolescent substance use also predicted lower levels of later parental support. The findings suggest reducing discrimination by peers and supportive parenting as potential targets for intervention in the prevention of substance use.