To analyze substance abuse impairment, a new ratio estimation procedure was used to improve estimates of hard-core drug users by accounting for the underestimation of these populations in the household surveys. The drug-using population was divided into groups based on alcohol and other substance abuse patterns. Study findings revealed that about 4.9 percent of female AFDC recipients had significant functional impairments related to substance abuse, impairments that may be sufficiently debilitating to preclude immediate participation in employment and training activities. When both female and male AFDC recipients were considered, the estimated impairment rate was slightly higher at 5.2 percent. An additional 10.6 percent of female AFDC recipients were somewhat impaired by substance abuse problems, indicating a likely need for substance abuse treatment concurrent with participation in employment and training activities. When male AFDC recipients were included as well, the impairment rate rose slightly to 11.2 percent. AFDC recipients had somewhat higher rates of substance abuse impairments than persons not in the AFDC program. Impaired AFDC recipients were more likely than other impaired persons to report receiving substance abuse treatment during the past year. Prevalence rates of self-reported nonmedical drug use were somewhat higher among persons who participated in the AFDC program than in the general population. Three or more episodes of binge drinking in the past month were reported by 8.2 percent of women in AFDC households and by 3.8 percent of all women aged 15 years and older. Among men and women combined, heavy episodic drinking was reported by 8.6 percent of persons aged 15 years and older. Study findings suggest that AFDC program administrators should recognize the presence of persons with substance abuse problems in their caseloads in order to improve the ability to serve these individuals and to better focus prevention and treatment efforts. Statistical testing results and drug dependence criteria are contained in appendixes. 8 references, 15 footnotes, and 4 tables