BACKGROUND: Few studies have examined the effects of treatment factors, including the types of services [chemical dependency (CD), psychiatric, or both], on long-term outcomes among adolescents following CD treatment, and whether receiving continuing care may contribute to better outcomes. This study examines the effect of the index CD and ongoing CD and psychiatric treatment episodes, 12-step participation, and individual characteristics such as CD and mental health (MH) severity and gender, age, and ethnicity, on 3-year CD and MH outcomes. METHODS: Participants were 296 adolescents aged 13 to 18 seeking treatment at 4 CD programs of a nonprofit, managed care, integrated health system. We surveyed participants at intake, 1 year, and 3 years, and examined survey and administrative data, and CD and psychiatric utilization. RESULTS: At 3 years, 29.7% of the sample reported total abstinence from both alcohol and drugs (excluding tobacco). Compared with girls, boys had only half the odds of being abstinent (OR = 0.46, p = 0.0204). Gender also predicted Externalizing severity at 3 years (coefficients 18.42 vs. 14.77, p < 0.01). CD treatment readmission in the second and third follow-up years was related to abstinence at 3 years (OR = 0.24, p = 0.0066 and OR = 3.33, p = 0.0207, respectively). Abstinence at 1 year predicted abstinence at 3 years (OR = 4.11, p < 0.0001). Those who were abstinent at 1 year also had better MH outcomes (both lower Internalizing and Externalizing scores) than those who were not (11.75 vs. 15.55, p = 0.0012 and 15.13 vs. 18.06, p = 0.0179, respectively). CONCLUSIONS: A CD treatment episode resulting in good 1-year CD outcomes may contribute significantly to both CD and MH outcomes 3 years later. The findings also point to the value of providing a continuing care model of treatment for adolescents.