Despite their low social standing, there remains a paucity of research on psychological distress among African Americans. We use data from the 2001–2003 National Survey of American Life to explore a wide array of social and economic predictors of psychological distress among African American adults aged 18 years and older, including previous incarceration, history of welfare receipt, and having a family member who is either currently incarcerated or homeless. Younger age, lower income, lower educational attainment, and lower self‐rated health and childhood health are associated with higher levels of psychological distress among African Americans. We also find a strong association between higher levels of material hardship, previous incarceration history, and the presence of a family member who is either incarcerated or homeless and higher levels of psychological distress. The findings highlight the importance of considering unique types of social disadvantage experienced by African Americans living in a highly stratified society.