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The existing body of research on substance use suggests associations with individuals’ internal well-being (e.g., self-esteem) and external well-being (e.g., physical health). Self-esteem is also significantly associated with physical health. However, the bidirectional relationships across substance use, self-esteem, and physical health over time have not been formally tested, as well as the potential indirect pathways. This study addresses this gap by examining both direct and indirect effects among self-esteem, physical health, and substance use from adolescence to young adulthood, while also considering potential gender differences in these relationships. Utilizing data from the first three waves of the National Longitudinal Study of Adolescent to Adult Health (Add Health), the study employs cross-lagged panel models to analyze the developmental interplay of these factors. Results reveal moderate stability in substance use, self-esteem, and physical health over time, emphasizing the need for early intervention. Notably, both drug and alcohol use during adolescence may lower self-esteem in young adulthood through their adverse effects on physical health. These findings contribute to a deeper understanding of the long-term dynamics between substance use and overall well-being, offering valuable insights for future research and effective health interventions.