© 2014 by the Research Society on Alcoholism. Background: Adolescent drinking is an important public health concern, one that is influenced by both genetic and environmental factors. The functional variant rs1229984 in alcohol dehydrogenase 1B (ADH1B) has been associated at a genome-wide level with alcohol use disorders in diverse adult populations. However, few data are available regarding whether this variant influences early drinking behaviors and whether social context moderates this effect. This study examines the interplay between rs1229984 and peer drinking in the development of adolescent drinking milestones. Methods: One thousand five hundred and fifty European and African American individuals who had a full drink of alcohol before age 18 were selected from a longitudinal study of youth as part of the Collaborative Study on the Genetics of Alcoholism (COGA). Cox proportional hazards regression, with G × E product terms in the final models, was used to study 2 primary outcomes during adolescence: age of first intoxication and age of first DSM-5 alcohol use disorder symptom. Results: The minor A allele of rs1229984 was associated with a protective effect for first intoxication (HR = 0.56, 95% CI 0.41 to 0.76) and first DSM-5 symptom (HR = 0.45, 95% CI 0.26 to 0.77) in the final models. Reporting that most or all best friends drink was associated with a hazardous effect for first intoxication (HR = 1.81, 95% CI 1.62 to 2.01) and first DSM-5 symptom (HR = 2.17, 95% 1.88 to 2.50) in the final models. Furthermore, there was a significant G × E interaction for first intoxication (p = 0.002) and first DSM-5 symptom (p = 0.01). Among individuals reporting none or few best friends drinking, the ADH1B variant had a protective effect for adolescent drinking milestones, but for those reporting most or all best friends drinking, this effect was greatly reduced. Conclusions: Our results suggest that the risk factor of best friends drinking attenuates the protective effect of a well-established ADH1B variant for 2 adolescent drinking behaviors. These findings illustrate the interplay between genetic and environmental factors in the development of drinking milestones during adolescence.