Research Findings: As policymakers expand access to preschool, the sociodemographic composition of preschool classrooms will become increasingly important. These efforts may create programs that increase the concentration of children from low-income families or, alternatively, foster the creation of socioeconomically diverse preschool classrooms. What effect the creation of such contexts would have on very young children remains unclear. Using multilevel methods and data on 2,966 children in 704 prekindergarten classrooms, this study explores the relationship between socioeconomic classroom composition and children's social and cognitive development. The results indicate positive associations between the mean socioeconomic status (SES) of the class and children's receptive language, expressive language, and mathematics learning, regardless of children's own sociodemographic backgrounds and the characteristics of their classrooms. However, the analyses indicate no association between the development of social competence and class mean SES. Practice or Policy: The links between classroom SES and language and mathematics development were comparable in size to those associated with instructional quality and even children's own SES. Neither structural nor instructional characteristics of prekindergarten classrooms explained these relationships, suggesting the possibility of direct peer effects. The findings indicate that the composition of children's classrooms should be considered an important aspect of preschool quality.