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The objectives of this study are to test the effects that the quality of leader–member exchange (LMX) and work group integration (WGI) may have on psychological health, as well as their interaction effect. Psychological health is defined both in terms of subjective well-being and psychological distress. Data were gathered from a sample of 249 employees working in a prison setting. Results indicated that LMX and WGI are positively related to subjective well-being and are negatively related to psychological distress. In addition, LMX and WGI exert a synergistic interaction effect on both dimensions of psychological health. Overall, the results show that the quality of the social environment may greatly enhance psychological health in a high-risk workplace.