Summary. School effectiveness analyses have largely ignored the role of the family as an important source of variation for children's educational progress. Sibling analyses in developmental psychology and behavioural genetics have largely ignored sources of shared environmental variation beyond the immediate family. We formulate a multilevel cross-classified model that examines variation in children's progress during secondary schooling and partitions this variability into pupil, family, primary school, secondary school, local education authority and residential area. Our results suggest that about 50% of what has been labelled as pupil variation in school effectiveness models is really between-family variation and that about 22% of the total variance is due to shared environments beyond the immediate family.