Aims: This study looks at the connection between parents' substance abuse and their 0-6 years old children's somatic and psychological health. Methods: A retrospective population-based cohort study based on Finnish health care and social welfare registers. The participants were all children born in Finland in 1997 (N=58,667) and 2002 (N=55,146) and their biological parents. Children were followed up for hospitalisations because of injuries, somatic illness and psychiatric disorders. The association between hospitalisations and parents' substance abuse as well as living with the abusing parent were estimated using logistic regression. Findings: Children's hospitalisations for all reasons were more prevalent if the mother or the father had a substance abuse problem. Mother's substance abuse increased the children's risk of hospitalisations for somatic illness (OR=1.34) and psychiatric disorders (OR=1.33, father's substance abuse increased the risk of hospitalisation because of psychiatric disorders (OR=1.18). The risks were even higher if both parents were substance abusers. Conclusions: Parents' substance abuse can cause a variety of harms to children, which may be related to unsafe environment, long-standing stress, and non-adequate responding to the child's needs. Multi-professional work with substance abusing parents and their children is crucial in order to reduce children's risks for poor health.