We examined the mediating role of family dynamics (marital quality, parental depression) in the link between economic pressure and child psychological functioning using the data from the National Survey of Family and Households (NSFH). From the initial multiethnic probability sample, we used a subsample of 2998 parents with a focal child 5 to 17 years of age. We used structural equation modeling using AMOS 4.0 to test the model. The results indicated support for associations among economic pressure, marital quality, parental depression, parenting strategies and children outcomes. Economic pressure was associated with lower marital quality and higher depression. Higher conflict and psychological distress was associated with frequent use of harsh discipline techniques and lower psychological functioning in children.