There is little data on whether school discipline or juvenile justice sanctions are directed disproportionately toward sexual minority youth (e.g., lesbian, gay, bisexual, or questioning; LGBQ) compared with heterosexual youth and even less on factors that may relate to such disparities. We tested for sexual orientation-based disparities in school suspension and juvenile justice system involvement, and tested a model linking students' sexual orientation to victimization, punishable infractions (substance use, truancy, weapon carriage on school property), and disciplinary actions. Using cross-sectional data from the 2012 Dane County Youth Assessment, we compared 869 LGBQ youth to 869 heterosexual youth (a comparison sample selected through propensity score matching) in Grades 9 to 12 (60.6% female; 74.7% White). LGBQ youth were more likely to report school suspension and juvenile justice system involvement than heterosexual youth. We documented minimal support for a differential behavior explanation: sexual orientation-based differences on discipline were only weakly mediated through victimization and punishable infractions. Instead, a multiple group comparison showed that the paths from infraction engagement to discipline sanctions were not invariant for LGBQ and heterosexual youth: With higher rates of infractions, the odds were greater for LGBQ youth to have experienced punitive discipline than for heterosexual youth. Our findings underscore the need for psychologists, educators, and juvenile justice professionals to give attention to discipline disparities faced by sexual minority youth.