OBJECTIVE This study examined measures of functional impairment and family relations in a sample of 62 adolescents with major depressive disorder (MDD) and 38 normal controls with no history of psychiatric illness. METHODS Ratings of the following domains were obtained: mother-child relations, father-child relations, spousal relations, sibling relations, peer relations, and school performance. Ratings of each domain for the 3-month period preceding the assessment were derived from information obtained using a semistructured interview administered independently to the adolescents and one of their parents. RESULTS Adolescents with MDD were found to have severe difficulties in all areas. Ninety percent of the depressed adolescents had scores greater than 2 SD above the mean of the normal controls on one or more of the domain ratings. In addition, adolescents with difficulties in parent-child relations were more likely than those adolescents without problems in family relations to have difficulties in peer relations and school performance. CONCLUSIONS The authors discuss the importance of systematically examining psychosocial variables in future studies of the etiology, course, and treatment of MDD in adolescents.