The effect of drinking during adolescence on adult functioning is a public health concern. A variety of mechanisms have been proposed where drinking in adolescence has an adverse impact on later outcomes; unfortunately, few studies have included methodologies that account for confounding influences that might link adolescent drinking with subsequent problems. To address this limitation, the current study used a co-twin control design, which uses members of twin pairs that differ from each other on their adolescent drinking. We used a prospective longitudinal sample drawn from the Minnesota Twin Family Study, consisting of 2,764 twins (1,434 female) assessed at regular follow-ups from age 17 to age 29. Adolescent drinking was defined by measures of early initiation of use and a measure of overall consumption at age 17. Adult outcomes included indicators of substance use, antisocial behavior, personality, socioeconomic status, and social functioning. The co-twin control analyses suggested that many of the associations between adolescent drinking and later outcomes were largely influenced by genetic confounding. However, for the measure of adolescent alcohol consumption, results were consistent with a small causal impact of drinking on multiple domains of adult functioning. This pattern was less consistently observed for the measures of early initiation. These results provide empirical justification for policies designed to alleviate long-term consequences associated with adolescent drinking by reducing the level of alcohol consumption in adolescence. In contrast, the evidence did not suggest that delaying drinking would have a broad impact on later-life adjustment.