The objective of the current study was to examine the relationships among neighborhood disadvantage, perceived neighborhood quality, family processes, and child internalizing problems within the framework of social disorganization theory. The sample consisted of 189 low-income, European American and Mexican American children and their mothers. The data analyses partially supported our hypotheses that mothers' perceptions of neighborhoods mediated the relation of neighborhood disadvantage to family processes, which in turn were associated with child internalizing problems. The value of contextual factors and social disorganization theory in studying the development of child adjustment problems was supported by the current study. Research issues and practical implications were discussed. (Contains 3 tables and 1 figure.)