Objective: Ethnic identity is a crucial aspect of identity development during adolescence. This study aimed to examine the potential protective effect of ethnic identity in the relation between peer stress and global life satisfaction among adolescents. Method: Data were collected via self-report measures from 417 adolescents (ages 14 to 18, 63.0% girls; 32.6% African American, 32.1% European American, 15.0% Asian American, 10.5% Hispanic or Latinx, 6.6% Biracial or Multiracial, and 0.7% Other) at one public, urban high school. Results: The first model tested ethnic identity as the single moderator in the entire sample, and the moderation effect was not significant. The second model added ethnicity (African American vs. European American) as another moderator, and moderation effects were significant for both moderators. Furthermore, the negative effect of peer stress on life satisfaction was stronger for African American adolescents than European American counterparts. For both racial groups, the negative effect of peer stress on life satisfaction decreased as ethnic identity increased. The third model tested a three-way interaction across peer stress, ethnicity (African American vs. European American), and ethnic identity, which was not significant. Conclusions: The results supported the buffering effect of ethnic identity in the context of peer stress for both African American and European American adolescents, and such effect appears to be more important for protecting African American adolescents' life satisfaction, though these two moderators appear to work independently, rather than interact with each other and the peer stressor. Implications and future directions are discussed.