Background Peer and parental substance use are established predictors for substance use among adolescent, little is known about influence of sibling cigarette smoking and its interaction with peer network on substance use potential that can introduce an important way for substance use prevention programs. Objective The aim of present study was to explore the association of sibling cigarette smoking and peer network with substance use potential among high school students in Tehran. Subjects Data were drawn from the population-based cross-sectional study of among 650 high schools students. Methods Multiple linear regression was used in order to determine the adjusted association between cigarette smoking among family members, peer network, their interaction and substance use potential. Result Having a sister who smokes (B = 3.19; p < 0.01) and peer network quality were associated with substance use potential (B = -0.1; p < 0.05). The increase in mean of substance use potential associated with decreases in peer network quality score is much more than in who have a sister with a cigarette smoking habit. Conclusion Having a sister who smokes interacts with peer network quality; appears to be one of the important mechanisms for adolescents' tendency to substance use. These findings can help in a better understanding of substance use potential mechanisms, screening efforts and the formulation of prevention programs.