This study evaluated the hypothesis that self-perceived gender nonconformity is distressing to children because it undermines a confident sense of gender compatibility. Participants were 357 early adolescents (180 boys, M age = 12.68 years) in England who responded to questionnaires measuring friendship styles (preoccupied, avoidant), gender compatibility (typicality, contentedness), and adjustment (self-esteem, peer social competence, depression, narcissism). Sex differences in friendship styles indicated that preoccupied and avoidant styles were typical for girls and boys, respectively. Gender-atypical friendship styles predicted poor adjustment, and their impact on adjustment was partially mediated by felt gender compatibility. Results suggest that perceiving gender-atypical attributes in the self undermines adjustment partly because it leads children to feel incompatible with their gender collective.