To examine the rates of young adult alcohol and drug use and alcohol problems, adolescent predictors of young adult alcohol problems and correlations with young adult social, work and recreational environments.Adolescents were followed longitudinally into young adulthood. Predictors were measured in grade 9 (average age 15), and environmental correlates and outcomes in young adulthood (average age 21).Students recruited in Victoria, Australia in 2002, were resurveyed in 2010/11.Analytical n=2309, 80% retention.Adolescent self-report predictors included past-month alcohol use. Young adults completed the Alcohol Use Disorders Identification Test (AUDIT) together with reports of environmental influences.Comparisons to United States national school graduate samples revealed higher rates of alcohol, tobacco and illicit drug use (other than cannabis) in Victoria. For example, rates of past month use at age 21-22 were: alcohol 69.3% US versus 84.9%, 95% confidence interval (CI) 81.3-88.6% Victoria; illicit drugs (other than cannabis) 8.8 versus 12.7%, CI 9.7-15.7%. AUDIT alcohol problems (scored 8+) were identified for 41.2%, CI 38.8-43.6% of young adults in Victoria. The likelihood of young adult alcohol problems was higher for frequent adolescent alcohol users and those exposed to environments characterized by high alcohol use and problems in young adulthood.High rates of alcohol problems are evident in more than two in five Australian young adults, and these problems appear to be influenced both by earlier patterns of adolescent alcohol use and by young adult social, work and recreational environments.