This article describes the use of structural equation modeling with latent variables to examine group differences and test competing models about cause-effect relationships in passive longitudinal designs. This approach is compared with several other statistical methods including analysis of cross-lagged panel correlations, regression analysis, and path analysis. The mechanics and advantages of structural equation modeling are illustrated using an example based on a 3-wave longitudinal study of adolescents' alcohol use. Within this example, the generalizability of the measurement model and structural model are assessed across gender and time, and competing models about the causes and consequences of adolescents' alcohol use are tested. The article concludes with a discussion of some of the strengths and limitations of using structural equation modeling with longitudinal data.