The author hypothesizes that children of chemically dependent parents are at very high risk for alcohol and drug abuse. This article examines the characteristics of alcohol and drug-abusing families and their children, and ways in which family heredity and the environment created by parents may place children at risk. Studies on genetic vulnerability and biological markers of alcoholism and drug abuse are cited. Also discussed are recent studies on characteristics of families with chemically dependent parents and their affective, cognitive, and behavioral impact on children. Existing family-focused prevention programs for children and adult children of chemically dependent parents are described, and implications for the most effective prevention strategies are presented. Recommendations are made concerning the need for more family-focused prevention interventions. 165 references.