Using data from 198 couples, this study examines whether associations between stress occurring outside of the dyad and key indicators of relationship functioning are mediated by stress arising within the dyad. Findings suggest that relationship satisfaction and sexual activity are governed by hassles and problems experienced within the dyad that are in turn related to stress arising outside the dyad. Associations between external stress and relationship functioning are stronger for daily hassles than for critical life events. Higher levels of daily stress predicted less sexual activity for maritally dissatisfied women and more sexual activity for maritally dissatisfied men. Self-reports of stress covaried with self-reported indexes of satisfaction and sexuality, suggesting that contextual influences are broadly influential in intimate relationships.