Resilience is defined as a dynamic and contextually embedded process of positive development despite exposure to significant adversity. The Australian Aboriginal and Torres Strait Islander population experience significant disadvantage and adversity relative to the non-Aboriginal population, with disproportionate and increasing rates of Aboriginal children in out-of-home care and substantiated child maltreatment seven times the rates for non-Aboriginal children. Despite decades of resilience research there remains a gap in our understanding of the extent to which specific mechanisms and processes support resilient outcomes. This discussion paper synthesizes findings from our four previously published studies which together illustrate the application of a person-based resilience framework of analysis in the context of Western Australian Aboriginal youth. We discuss the implications of this approach for better understanding processes differentially impacting psychosocial functioning of youth depending on level of family-risk exposure. Data for these studies were available for 1021 Aboriginal youth, 12–17 years, drawn from the 2000–2002 Western Australian Aboriginal Child Health Survey (WAACHS), a population representative survey of 5289 Aboriginal children (0–17 years) living in 1999 families. Multivariate logistic regression analyses were used to model the differential influence of individual, family, cultural and community factors on psychosocial outcomes depending on family-risk context. Key findings revealed 56% of high-risk youth as psychosocially resilient; prosocial friendship and living in low SES neighborhoods uniquely protected psychosocial functioning; and exposure to racism was an additional risk factor for low-risk exposed youth. We conclude that a resilience perspective holds potential for exploring diversity within disadvantaged populations, identifying processes uniquely beneficial for those at greatest risk, and provides crucial insights for communities, practitioners and policy-makers.