This study identifies the conceptual underpinnings of effective school-based drug education practice in light of contemporary research evidence and the practical experience of a broad range of drug education stakeholders. The research involved a review of the literature, a national survey of 210 Australian teachers and others involved in drug education, and structured interviews with 22 key Australian drug education policy stakeholders. The findings from this research have been distilled and presented as a list of 16 principles that underpin effective drug education. In broad terms drug education should be evidence based, developmentally appropriate, sequential and contextual. Programs should be initiated before drug use commences. Strategies should be linked to goals and should incorporate harm minimisation. Teaching should be interactive and use peer leaders. The role of the classroom teacher is central. Certain program content is important, as is social and resistance skills training. Community values, the social context of use, and the nature of drug harm have to be addressed. Coverage needs to be adequate and supported by follow-up. It is envisaged that these principles will provide all those involved in the drug education field with a set of up to date, research based guidelines against which to reference decisions on program design, selection, implementation and evaluation.