BackgroundChildren from low-socioeconomic backgrounds exhibit more behavioural difficulties than those from more affluent families. Influential theoretical models specify family stress and child characteristics as mediating this effect. These accounts, however, have often been based on cross-sectional data or longitudinal analyses that do not capture all potential pathways, and therefore may not provide good policy guidance.MethodsIn a UK representative sample of 2399 children aged 5–15, we tested mediation of the effect of household income on parent and teacher reports of conduct problems (CP) via unhealthy family functioning, poor parental mental health, stressful life events, child physical health and reading ability. We applied cross-lagged longitudinal mediation models which allowed for testing of reciprocal effects whereby the hypothesised mediators were modelled as outcomes as well as predictors of CP.ResultsWe found the predicted significant longitudinal effect of income on CP, but no evidence that it was mediated by the child and family factors included in the study. Instead, we found significant indirect paths from income to parental mental health, child physical health and stressful life events that were transmitted via child CP.ConclusionThe results confirm that income is associated with change in CP but do not support models that suggest this effect is transmitted via unhealthy family functioning, parental mental health, child physical health, stressful life events or reading difficulties. Instead, the results highlight that child CP may be a mediator of social inequalities in family psychosocial functioning.