The racial disparity in the American juvenile justice system impacts the lives of many youth of color. Youth of color constitute 34% of the U.S. population, however, they make up 62% of the youth charged in the juvenile justice system. The cycle of racial inequality and imprisonment are factors influenced by residential segregation and policing practices. Juvenile justice involvement leads to poorer physical and mental health in youth, stymied social outcomes, poorer familial relationships, decreased graduation and employment rates, increased rates in violence, and long‐term negative future outcomes. The article advocates for mental health treatment and family services to be incorporated within incarcerated settings. Clinical strategies and future direction are discussed to begin to combat these various adverse impacts.