The aim of this two-wave study was to examine the mediating role of adolescent appraisals of family security in the relation between family instability and adolescent self-esteem in a sample of 377 adolescents and their mothers. Mothers' reports of family instability at Time 1 were significantly and positively associated with adolescent appraisals of family insecurity at Time 1 and Time 2. Adolescent self-esteem at Time 2 was significantly and negatively related to family instability at T1 and family insecurity at Time 1 and Time 2. Findings from structural equation models supported the hypothesis that family instability undermines adolescents' self-esteem one year later by directly threatening adolescents' appraisals of family as a safe and secure system. The results indicated that adolescent appraisals fully mediated the relation between family instability and adolescent self-esteem. The implications of the findings for adolescent development in a secure and stable family environment are discussed and suggestions for further process-oriented research on the relation between family instability and adolescent development are stated.