Purpose: This study adapted the Structural Family Systems Ratings (SFSR), an observational measure of family interactions, for dementia caregivers. This article presents the development of the SFSR-Dementia Caregiver adaptation (SFSR-DC) and examines relationships between specific family-interaction patterns and caregiver distress. Design and Methods: The families of 177 Cuban American and White non-Hispanic American caregivers of dementia patients were assessed at baseline, 6, 12, and 18 months. Structural family theory and clinical experience were used to identify family interaction patterns believed to be related to caregiver emotional functioning. Factor analysis was used to refine subscales and develop a multiscale measure. Results: Six reliable subscales were related to caregiver distress and included in the SFSR-DC. There were two second-order factors. The SFSR-DC was provisionally cross-validated and showed invariance across the two ethnic groups. Implications: The SFSR-DC provides a method for examining specific and multiple interaction patterns in caregiver families and thus can advance knowledge regarding the role of the family in the stress processes of caregiving. These findings support the relevance of family interactions in caregiver distress and suggest that a treatment approach aimed at supporting family closeness and conflict resolution and reducing negativity might enhance caregiver well-being.