While heterosexist family undermining has been demonstrated to be a developmental risk factor in the life of persons with same-gender orientation, the issue of protective family factors is both controversial and relatively neglected. In this study of Israeli gay males (N = 114), we focused on the interrelations of family support, family acceptance and family knowledge of gay orientation, and gay male identity formation, and their effects on mental health and self-esteem. A path model was proposed based on the hypotheses that family support, family acceptance, family knowledge, and gay identity formation have an impact on psychological adjustment, and that family support has an effect on gay identity formation that is mediated by family acceptance. The assessment of gay identity formation was based on an established stage model that was streamlined for cross-cultural practice by defining three basic processes of same-gender identity formation: self-definition, self-acceptance, and disclosure (Elizur & Mintzer, 2001). The testing of our conceptual path model demonstrated an excellent fit with the data. An alternative model that hypothesized effects of gay male identity on family acceptance and family knowledge did not fit the data. Interpreting these results, we propose that the main effect of family support/acceptance on gay identity is related to the process of disclosure, and that both general family support and family acceptance of same-gender orientation play a significant role in the psychological adjustment of gay men.