This paper explores the relationships among adolescent leisure activities, peer behavior, and substance use. We suggest that peer group interaction can have a differential effect on adolescent deviant behavior depending on the type of leisure pattern adolescents engage in. We analyze data from a representative national sample of Icelandic adolescents, exploring the variations in the use of alcohol and illegal drugs among three different patterns of leisure activity, controlling for parental ties and school commitment. The findings show that alcohol and substance use varies significantly across the three leisure patterns. Moreover, it was found that the well-known relationship between adolescent substance use and having the substance-using friends is significantly contingent on the type of leisure pattern. Our findings suggest that it is important to take into account different peer leisure activities in order to understand adolescent substance use. Finally, we discuss the implications of the findings for prevention work with adolescents. (Contains 6 tables.)