This study examined whether social competence at the time of entrance to elementary school predicted school adjustment two years later. The sample consisted of 389 children followed from the 1st to the 3rd grade in Lithuanian urban schools. In the 3rd-grade school adjustment was measured by assessing popularity in class, student-teacher relationships, involvement in bullying, school anxiety, and academic achievement. All school adjustment variables assessed in the 3rd grade were linked to learning-related social competence, while the interpersonal aspect of social competence was related to all indicators of school adjustment except for involvement in bullying in the 3rd grade. Results of structural equation modeling indicated that learning-related social competence measured during the 1st year of schooling was the strongest predictor for academic achievement and teacher-student conflict in the 3rd grade, while interpersonal social competence was the strongest predictor of student-teacher closeness and social school anxiety two years later.