This study examined reciprocal contributions between shyness-sensitivity and social, school, and psychological adjustment in urban Chinese children. Longitudinal data were collected once a year from Grade 3 to Grade 6 (ages 9-12 years) for 1,171 children from multiple sources. Shyness-sensitivity positively contributed to social, school, and psychological difficulties over time, with the most consistent effects on peer preference and loneliness. Social and school adjustment negatively contributed to the development of shyness-sensitivity. The initial levels of shyness-sensitivity and social and school adjustment moderated the growth of each other, mainly as a resource-potentiating factor. The results indicate the significance of shyness-sensitivity for adjustment and the role of adjustment in the development of shyness-sensitivity in today's urban Chinese society.