Normal adolescent development is often accompanied by transient emotional and behavioral problems. For most individuals with postpubertal-onset adjustment problems, there is a resolution by early adulthood and relative stability through the adult life span. But for a minority, adjustment problems escalate during adolescence and portend the development of serious mental illness in adulthood. In this article, we explore adolescent behavioral changes and neurodevelopmental processes that might contribute to stress sensitivity and vulnerability for the emergence of the mental disorders. Of particular interest is the role that hormonal changes might play in the expression of genetic vulnerabilities for psychopathology. Drawing on recent findings from clinical research and behavioral neuroscience, we describe the ways in which postpubertal hormones might alter brain function and, thereby, behavior. It is concluded that there are both activational and organization effects of hormones on the adolescent brain, and these contribute to developmental discontinuities in behavioral adjustment. Implications for adult psychopathology and preventive intervention are discussed.