We propose a new model of volatility where financial leverage amplifies equity volatility by what we call the “leverage multiplier”. The exact specification is motivated by standard structural models of credit; however, our parametrization departs from the classic Merton (1974) model and is, as we show, flexible enough to capture environments where the firm's asset volatility is stochastic and asset shocks are non-normal. As a result, our model also provides estimates of asset returns and asset volatility. In addition, our specification nests both a standard GARCH and the classical Merton model, which allows for a simple statistical test of how leverage interacts with equity volatility. We then apply the Structural GARCH model to two applications: the leverage effect and systemic risk measurement.