After so many years, there are still people wondering wether Squall and Rinoa are related or not. I wanna tell you the story in the game is kind of confusing, I know. But if you really go indept in it, then you can possible find out that they aren't connected to each other in the way you think they are.

In Deling City you can find out that Laguna has a crush on a woman named Julia Heartilly, to find out on the same time that she likes him. On the conversation between them both you see the screen fade away for a couple of times, but that's just to skip most of the conversations. I would say that nothing has happend between them, because Laguna would do everything to return back to Julia, yet in the end he didn't.

When he dissapeared Julia was comforted by Fury and fell in love with him. Many then seem to think that her child is from Laguna, but it isn't. It is certainly discust in the game and through Square-Enix that Julia became pregnant of a girl after she got married with Fury Caraway. If Rinoa would have been Laguna's daughter then her personality, looks and birthday would have been different and would she be much older then Squall, maybe 18 years rather then 17.

At this time aswell, Laguna met Raine. Raine gave birth of Squall months later of Squall. The easiest way to calculate everything through is the fact that Laguna has lived in Winhill for 1 year the moment Kiros came to town, and Laguna and Raine weren't engaged as of yet, so she couldn't have been pregnant. In the conversation you can tell that Julia just had married and brought a song called 'Eyes on me'. Later she became pregnant just before Laguna went to search for Ellone.

It is clear that Rinoa is older then Squall, just some months. If Laguna was really the father, then the moment he talked to Kiros in Winhill and talking about he lives there for a year, should be the moment that Rinoa would have been born. But Julia only got pregnant at that time.

Yes, Squall and Rinoa are related, just not in this way. You can see it is highly impossible for them to be family if they are just months different and Laguna dissapeared out of Julia's life for a year. My theory of how they are related is similar as the love that Julia and Laguna had for each other. Those love remains in the hearts of their children, that is how their relationship is so strong.