BACKGROUND:Parents and peers both influence the development of adolescent substance misuse, and the Social Interaction Learning (SIL) model provides a theoretical explanation of the paths through which this occurs. OBJECTIVE:The SIL model has primarily been tested with conduct outcomes and in US samples. This study adds to the literature by testing the SIL model with four substance use outcomes in a sample of Australian youth. METHOD:We used structural equation modeling to test the fit of the SIL model to a longitudinal sample (n = 907) of students recruited in grade 5 in Victoria, Australia participating in the International Youth Development Study, who were resurveyed in grades 6 and 10. RESULTS:The model fit was good (χ2(95) = 248.52, p < .001; RMSEA = .04 [90% CI: .036 - .049]; CFI = .94; SRMR = .04). Path estimates from parenting to antisocial behavior and from antisocial behavior to antisocial peers were significant. In turn, having antisocial peers was significantly related to alcohol use, binge drinking, tobacco use, and marijuana use. From parenting, only the direct path to marijuana use was significant, but indirect effects were significant. CONCLUSIONS:The SIL model illustrates that parenting plays an early role in the formation of adolescent peer relations that influence substance misuse and identifies etiological pathways that can guide the targets of prevention. The SIL pathways appear robust to the Australian social and policy context.