The impact of early therapeutic alliance was examined in 100 clients receiving either individual cognitive- behavioral therapy (CBT) or family therapy for adolescent substance abuse. Observational ratings of adolescent alliance in CBT and adolescent and parent alliance in family therapy were used to predict treatment retention (in CBT only) and outcome (drug use, externalizing, and internalizing symptoms in both conditions) at post and 6-month follow-up. There were no alliance effects in CBT. In family therapy, stronger parent alliance predicted declines in drug use and externalizing. Adolescents with weak early alliances that subsequently improved by midtreatment showed significantly greater reductions in externalizing than adolescents whose alliances declined. Results underscore the need for ongoing developmental calibration of intervention theory and practice for adolescent clinical populations.