Background Adolescent substance use is often influenced by socioeconomic and geographical factors. While higher parental education is typically associated with lower substance use, these protective effects may be weaker for marginalized groups facing structural disadvantages that limit the utility and returns of their economic and social resources. Rural areas, characterized by fewer employment opportunities and limited recreational activities, may contribute to marginalization-related diminished returns (MDRs) of parental education on adolescent substance use, including inhalant use. Objectives This study applies the MDRs framework to examine whether the protective effect of higher parental education on current inhalant use (past 30 days) among 12th-grade American adolescents varies by geographic location. Specifically, we assess whether youth from highly educated families in rural areas are at a disproportionate risk of inhalant use compared to their urban and suburban peers. Methods Using data from the 2024 Monitoring the Future (MTF) study, a nationally representative survey of 12th-grade adolescents in the U.S., we tested main effects and statistical interactions between parental education and residence (rural vs. urban/suburban) in predicting the odds of inhalant use over the past 30 days. Logistic regression models, both with and without interaction terms, were applied to evaluate whether the protective effects of parental education varied by residence location, controlling for relevant demographic and socioeconomic factors. Results Findings indicate a significant interaction between parental education and rural residence. While higher parental education was associated with lower odds of inhalant use in urban and suburban areas, this protective effect was substantially weaker in rural settings. Adolescents from highly educated families in rural areas exhibited a higher-than-expected risk of inhalant use, suggesting that geographic marginalization attenuates the benefits of parental socioeconomic resources. Conclusions These results highlight the role of place-based marginalization in shaping adolescent substance use disparities, demonstrating that MDRs extend beyond race and ethnicity to location-based disadvantages. Rural youths from highly educated families may face unique structural and social challenges that counteract the protective effects of parental education. Public health efforts should consider place-based interventions that address the economic, recreational, and social limitations of rural environments to reduce substance use risk among high-SES adolescents residing in rural areas.