A vast array of family processes is linked to child mental development, among which (1) low parental acceptance and (2) high family conflict are known as transdiagnostic risk factors for child internalizing and externalizing psychopathology. In contrast to most prior research adopting cross-sectional or lagged designs, the current study applied fine-grained multilevel modeling to elucidate the complex relationships among parental acceptance, family conflict, and child psychopathology, considering the nesting structure of children within families and longitudinal changes within children. We focused on preadolescents from the two-wave Adolescent Brain Cognitive Development Study (N = 4,953; aged 9–12) and accounted for parental psychopathology and sex differences. Our findings suggest that consistent between-family and between-child differences in parental acceptance play a transdiagnostic role for both child internalizing and externalizing psychopathology, whereas family conflict is only significantly associated with externalizing psychopathology. Additionally, short-term within-family and within-child improvements in parental acceptance and family conflict across one year were associated with decreased externalizing, but not internalizing, psychopathology. These findings support the potential importance and feasibility of targeting these family process factors for child externalizing problems outside of an intensive treatment setting. We further discussed how such findings serve as a foundation for future research on family processes and child internalizing problems. The varying results across different grouping levels highlight the importance of decomposing within- from between-family/child effects in future studies on family processes and child psychopathology.