Court-involved youth exhibit high rates of psychiatric symptoms, substance use, and delinquency, yet little is known about the contributing roles of caregiver and family factors. The current study examined whether family functioning and parental monitoring mediate the relationship between caregiver and youth psychiatric symptoms (at first court contact) and youth substance use and delinquency (two years later). Participants were 400 first-time offending court-involved youth (M = 14.5 years; 57.3% male; 45.6% non-Latinx White, 42.0% Latinx) and an involved caregiver (M = 41.0 years; 87.2% female; 53.0% non-Latinx White, 33.8% Latinx). Structural equation modeling revealed that caregiver and youth psychiatric symptoms were prospectively associated with worse family functioning, which was in turn related to higher levels of youth delinquency and greater likelihood of substance use. The results support the notion of addressing the needs of justice-involved youth and families holistically rather than treating youth as "the problem" in isolation.