Some evidence suggests that close friends may be knowledgeable of youth's psychological adjustment. However, friends are understudied as reporters of adjustment. The current study examines associations between self- and friend-reports of internalizing and externalizing adjustment in a community sample of fifth-, eighth-, and eleventh-grade youth. The study extends prior work by considering the degree to which friends' reports of youth adjustment are "accurate" (i.e., predicted by youths' actual adjustment) versus "biased" (i.e., predicted by the friend reporters' own adjustment). Findings indicated stronger bias effects than accuracy effects, but the accuracy effects were significant for both internalizing and externalizing adjustment. Additionally, friends who perceived their relationships as high in positive quality, friends in relationships high in disclosure, and girls perceived youths' internalizing symptoms most accurately. Knowledge of externalizing adjustment was not influenced by gender, grade, relationship quality, or self-disclosure. Findings suggest that friends could play an important role in prevention efforts.