Adolescent engagement in risk taking is a public health concern, given the increase in risk-taking behaviors during this developmental period arid the possibility for negative outcomes (e.g. drug abuse or death). This study attempted to develop a model of risk-taking propensity, as indicated by a naturalistic assessment paradigm, in inner-city African American adolescents (N=108) who were prenatally drug-exposed or non-exposed using psychological and physiological stress indicators. The stress indicators used were caregiver and adolescent psychological stress, as indicated by self-report, and adolescent physiological stress, as indicated by cortisol. The study used cross-sectional and longitudinal data to examine the unique prediction or risk-taking propensity and the structural relations of the variables of interest with risk-taking propensity. The relations of the variables of interest with risk-taking propensity were limited, but did vary considerably by sex and status of prenatal drug exposure, which suggests that the theory of stress in adolescent risk remains tenable, Future research with more appropriate indicators of stress and larger samples to adequately test for interactions is necessary. Continuing efforts to identify predictors of adolescent risk-taking are essential to identify variables that are amenable to interventions which can prevent or reduce the negative consequences of engagement in risk-raking behavior.