First, and most important, where is your husband on this? You need him on your side if you're going to have any chance of all at keeping your MIL from watching your kids - because yeah, I completely agree, she's NOT a good babysitting option! Your husband needs to be on your side, and not afraid to stick up for you. That'll make the rest much easier. I think you're right to keep her from watching your kids unsupervised. Unfortunately, I'm not sure there's an easy way to tell her the truth without causing major family stress. "I don't trust you with my kids" isn't exactly going to smooth anyone's feathers. Of course, if you don't care about her feelings, then by all means, the next time she asks why you won't let her watch the kids, tell her exactly why. She smokes, she's admitted to letting her kids do illegal drugs and take prescription medications they weren't allowed to have, and she's verbally abusive to you. Those are all excellent reasons not only to keep her from babysitting, but to keep her under your eye when she's with your kids.