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This study investigates the effects of a broad-based policy change that altered maternal employment, family income, and other family characteristics on drug-related crime among youth. Specifically, we exploit differences in the implementation of welfare reform in the United States across states and over time in the attempt to identify causal effects of welfare reform on youth arrests for drug-related crimes between 1990 and 2005, the period during which welfare reform unfolded. We use monthly arrest data from the U.S. Federal Bureau of Investigation’s Uniform Crime Reports to estimate the effects of welfare reform implementation on drug-related arrests among 15- to 17-year-old teens exposed to welfare reform. The findings, based on numerous different model specifications, suggest that welfare reform had no statistically significant effect on teen drug arrests. Most estimates were positive and suggestive of a small (3%) increase in arrests.