Lesbian, gay, bisexual, and other same-sex attracted young people have been shown to be at a higher risk of mental health problems, including depression, anxiety, suicidality, and substance abuse, compared to their heterosexual peers. Homophobic prejudice and stigma are often thought to underlie these disparities. In this study, the relationship between such experiences of social derogation and mental health and substance use in same-sex attracted young people was examined using Meyer's minority stress theory. An online survey recruited 254 young women and 318 young men who identified as same-sex attracted, were aged 18-25 years, and lived in Sydney, Australia. Multivariate logistic regression analyses showed that internalized homophobia, perceived stigma, and experienced homophobic physical abuse were associated with higher levels of psychological distress and self-reported suicidal thoughts in the previous month. Furthermore, perceived stigma and homophobic physical abuse were associated with reporting a lifetime suicide attempt. The association between minority stress and substance use was inconsistent. While, as expected, higher levels of perceived stigma were associated with club drug dependence, there was an inverse association between internalized homophobia and club drug use, and between perceived stigma and hazardous alcohol use. The findings of this study provide support for the minority stress theory proposition that chronic social stress due to sexual orientation is associated with poorer mental health. The high rates of mental health and substance use problems in the current study suggest that same-sex attracted young people should continue to be a priority population for mental health and substance use intervention and prevention.