This study examined (a) associations of progression to daily cigarette smoking with lifetime psychopathology, regular smoking by family members, and psychopathology in family members, (b) the degree to which disorders precede or follow progression to daily smoking, and (c) whether daily smokers differ as a function of nicotine dependence. Among 941 participants interviewed at three time points, 722 (77%) had experimented with cigarette smoking, 391 of whom (54%) progressed to daily smoking. Lifetime psychiatric diagnoses were obtained at each assessment. Biological parents and full siblings were interviewed for lifetime psychopathology and regular smoking. Progression to daily smoking was associated with lower parental education, major depression, alcohol and drug use disorders, attention-deficit/hyperactivity disorder (ADHD) or disruptive behavior disorders, antisocial personality disorder symptoms, regular smoking by father (but not mother or sibling), and one measure of psychopathology in family members (externalizing disorders, which consisted of ADHD, conduct disorder, oppositional defiant disorder, and antisocial personality disorder). When composite measures of internalizing disorders, externalizing disorders, familial smoking, and familial psychopathology were examined in a single model, only the externalizing disorders composite remained associated with both daily smoking and nicotine dependence. Only ADHD consistently preceded the onset of daily smoking. Nicotine dependence was associated with drug use disorders and alcohol use disorders. In conclusion, externalizing disorders had the strongest associations, both with progression to daily smoking among adolescents who initiate smoking and with nicotine dependence among the daily smokers. Limitations of the present study and future research directions are noted.