Three models of the prospective relations between child maladjustment and peer victimization are examined: (a) internalizing results directly from victimization, (b) internalizing leads to victimization, and (c) physical aggression fuels retaliatory victimization that leads to increases in internalizing over time. Data came from assessments of children at the beginning of Grade 1 (n = 432; average age = 6.3 years), with follow-ups at the end of Grades 1, 2, and 3. Most children showed low stable internalizing trajectories (73%); however, high stable and increasing curvilinear trajectories were evident for 7% and 20% of children, respectively. Findings suggest that children’s adjustment problems at entry to Grade 1 affect the course of their internalizing, in part, by setting the stage for peer victimization.