Mental health disorders in adolescence are pervasive, often carry into adulthood, and appear to be inversely associated with social status. We examine how structural aspects of neighborhood context, specifically, socioeconomic stratification and racial/ethnic segregation, affect adolescent emotional well-being by shaping subjective perceptions of their neighborhoods. Using a community-based sample of 877 adolescents in Los Angeles County, we find that youth in low socioeconomic status (SES) neighborhoods perceive greater ambient hazards such as crime, violence, drug use, and graffiti than those in high SES neighborhoods. The perception of the neighborhood as dangerous, in turn, influences the mental health of adolescents: the more threatening the neighborhood, the more common the symptoms of depression, anxiety, oppositional defiant disorder, and conduct disorder. Social stability and, to a lesser extent, social cohesion, also emerge as contributors to adolescent disorder. This investigation demonstrates that research into the mental health of young people should consider the socioeconomic and demographic environments in which they live.