Pressure on Stormont budgets has made preventing ill-health in Northern Ireland more difficult, the Public Health Agency (PHA) has said.
More should be invested but services are being affected by the pressure on spending, the organisation's annual report added.
The NHS faces a host of problems, with many children smoking or taking drugs as well as significant levels of youth obesity and poor mental health.
The report said: "The current situation also presents something of a paradox; the need to spend more on prevention is clear, yet more difficult because of the budget pressure on service delivery.
"Improving health and wellbeing is also likely to be compounded by financial pressures experienced by other government departments whose policies will impact on health.
"Further welfare reform is expected to have an adverse impact on those who are most disadvantaged."
The PHA report said its investment in smoking cessation services improved outcomes for patients and saved the health service thousands of pounds.
Almost a third of pregnant women in the most deprived areas smoke. By the age of 13, 62% of children across Northern Ireland have smoked tobacco, with a quarter doing so every day.
According to the report, the earlier children become regular smokers and persist in the habit as adults, the greater the risk of developing lung cancer or heart disease. Early uptake of smoking is associated with subsequent heavier smoking; higher levels of dependency; a lower chance of quitting and higher mortality.
Almost a fifth of young people in school years eight to 12 have taken a form of drug or solvent at some point in their life, 13% within the last year.