This study examined links between processes of establishing autonomy and relatedness in adolescent-family interactions and adolescents' psychosocial development. Adolescents in 2-parent families and their parents were observed in a revealed-differences interaction task when adolescents were 14, and adolescents' ego development and self-esteem were assessed at both 14 and 16. Developmental indices were strongly related to autonomy and relatedness displayed by both parents and adolescents. Significant variance was explained even after accounting for the number and quality of speeches of each family member as rated by a different, well-validated family coding system. Increases in adolescents' ego development and self-esteem over time were predicted by fathers' behaviors challenging adolescents' autonomy and relatedness, but only when these occurred in the context of fathers' overall display of autonomous-relatedness with the adolescent. The importance of the mutually negotiated process of adolescents' exploration from the secure base of parental relationships is discussed.