Previous research suggests that the prevalence of aggression is high among low-income urban youth who have to cope with a number of psychological stressors. Less is known about the early development and consequences of aggression and peer victimization prior to adolescence in these contexts. This study examined the correlates, interplay, and consequences of aggression and victimization among children in a low-income urban context. Data were collected in the spring of grades 1, 2, and 3. The final sample included 333 children (59.5% girls, "M" = 6.46 years). Each year, children completed sociometric and peer assessments in their classrooms. A cross-lagged panel model with extended effects showed that aggression was relatively stable over time, whereas victimization was less stable. Aggression and victimization became increasingly less correlated over time. Further, early victimization negatively predicted later aggression for boys, but positively for girls. Growth curve modeling showed that initial aggression and victimization were associated with initial behavioral and relational problems. Early aggression, but not victimization, predicted relative stable or increasing in behavioral and relational problems over time. The results underscore the importance of a developmental perspective on early childhood aggression and victimization in high-risk contexts, in order to understand their implications for adjustment in adolescence.