The early cognitive development and motor development of male preschool children with an alcoholic father were compared with matched control subjects from non-alcoholic families who resided in the same neighborhoods. Families were participants in the Michigan State University Longitudinal Study, into which were recruited all drunk drivers convicted in local district courts who had a blood alcohol level of 0.15 percent or higher and who had a biological 3- to 6-year-old son living with them. Despite meticulous neighborhood searches, findings showed that the socioeconomic status (SES) of control families was significantly higher than alcoholic families, as were Home Observation for Measurement of the Environment (HOME) inventory ratings. Findings indicated that the overall developmental quotient and personal social development of control boys was significantly more advanced than that of the high-risk boys when SES and/or HOME scores were not considered. Analyses of developmental data with SES as a covariate resulted in less significant differences between the groups. Most significantly, when HOME scores were considered as a covariate, all differences disappeared. Demonstrating the impact of the quality of the home environment on development, findings indicated that paternal alcohol problems affect the cognitive and motor development of preschoolers only when they are sufficiently disruptive to degrade aspects of the family environment related to early intellectual development. Over 40 references are cited. (RH)