SYNOPSIS: Objective. This study examined the bidirectional relations between effective parenting practices and externalizing problems in children in homeless families. Design. The sample comprised 223 children (M = 8.12 years) in 137 families living in temporary supportive housing, who participated in the Early Risers conduct problems prevention program lasting 2 years. Video-recorded observations of parent-child interactions were collected and rated by trained observers to assess effective parenting practices. Child externalizing problems were reported by their school teachers. Both variables were assessed at baseline prior to intervention and at 1- and 2-year post-baseline. Results. Child externalizing problems at baseline were negatively associated with effective parenting from baseline to year 1 as well as from year 1 to year 2. Observed effective parenting practices at year 1 were negatively associated with child externalizing problems from year 1 to year 2.Conclusions. These findings underscore the presence of bidirectional influence processes between parents and children in high-risk families. Implications for intervention programs for high-risk families are discussed.