We summarize prior theories on the adaptation process of the contemporary immigrant second generation as a prelude to presenting additive and interactive models showing the impact of family variables, school contexts and academic outcomes on the process. For this purpose, we regress indicators of educational and occupational achievement in early adulthood on predictors measured three and six years earlier. The Children of Immigrants Longitudinal Study, used for the analysis, allows us to establish a clear temporal order among exogenous predictors and the two dependent variables. We also construct a Downward Assimilation Index, based on six indicators and regress it on the same set of predictors. Results confirm a pattern of segmented assimilation in the second generation, with a significant proportion of the sample experiencing downward assimilation. Predictors of the latter are the obverse of those of educational and occupational achievement. Significant interaction effects emerge between these predictors and early school contexts, defined by different class and racial compositions. Implications of these results for theory and policy are examined. (Contains 2 figures, 8 tables and 7 notes.)