A growing body of research has documented structural and functional brain development during adolescence, yet little is known about neurochemical changes that occur during this important developmental period. Magnetic resonance spectroscopy (MRS) is a well-developed technology that permits the in vivo quantification of multiple brain neurochemicals relevant to neuronal health and functioning. However, MRS technology has been underused in exploring normative developmental changes during adolescence and the onset of alcohol and drug use and abuse during this developmental period. This review begins with a brief overview of normative cognitive and neurobiological development during adolescence, followed by an introduction to MRS principles. The subsequent sections provide a comprehensive review of the existing MRS studies of development and cognitive functioning in healthy children and adolescents. The final sections of this article address the potential application of MRS in identifying neurochemical predictors and consequences of alcohol use and abuse in adolescence. MRS studies of adolescent populations hold promise for advancing our understanding of neurobiological risk factors for psychopathology by identifying the biochemical signatures associated with healthy brain development, as well as neurobiological and cognitive correlates of alcohol and substance use and abuse.