This study assesses the link between social capital factors of norm‐setting social arenas including family, school, and neighborhood and adolescent substance use measured by cigarette smoking, alcohol consumption, and illicit drug use among a sample of adolescents in California. The key messages of this study are that socialization processes at different life domains, in varying degrees, are associated with adolescent substance use behavior. Compared with school and neighborhood contexts, family is the most influential setting that should be primarily targeted for youth substance use prevention. Among different aspects of within‐family social resources, parental monitoring seems to be the most protective of adolescent substance use. Study implications on family‐based interventions are discussed.