Although alcoholic parents and their families are a heterogeneous group, children in these family systems are generally at risk for a variety of negative outcomes. It seems that the role of parental alcohol misuse in child adjustment is mediated by family variables. This study examined whether the impact of parental alcohol misuse on children’s self-concept can be explained by family functioning. In addition, the relation of family functioning to self-concept was examined. The study sample, between 1991 and 1994, consisted of 416 children, ages 10-18 living in urban, suburban and rural areas of a southeastern State and were from 2 groups: (1) children in a program held annually for high-functioning youths selected to receive training as peer counselors at their schools and (2) children residing outside their families due to presumed low functioning on their part and/or that of their families. Consistent with previous findings using family functioning variables to explain different outcomes in children of alcoholics was that parentification played either a mediating or primary role in children’s self-concept. In addition, parental substance misuse alone could not sufficiently account for the psychological adjustment of these children, especially in low functioning children. The study adds to the growing debate underscoring the role of family relationships in the socioemotional development of children of alcoholic parents. Glossary and references