This longitudinal study examines the relationships between perceived family functioning and adolescent psychological well-being and problem behavior in Chinese adolescents with economic disadvantage (N = 199). Results showed that perceived family functioning was concurrently related to measures of adolescent psychological well-being (existential well-being, mastery, life satisfaction, self-esteem, and general psychiatric morbidity) and problem behavior (substance abuse and delinquency) at Time 1 and Time 2. Longitudinal and prospective analyses (Time 1 predictors predicting Time 2 criterion variables) suggest that the relations between perceived family functioning and adolescent psychological well-being and problem behavior were bidirectional in nature. The longitudinal linkages between family functioning and adolescent adjustment were found to be stronger in Chinese adolescent girls than in Chinese adolescent boys with economic disadvantage.