The goals of this study were to investigate whether young children attending Head Start (N = 292; M[subscript age] = 4.3 years) selected peers based on their preschool competency and whether children's levels of preschool competency were influenced by their peers' levels of preschool competency. Children's peer interaction partners were intensively observed several times a week over 1 academic year. Social network analyses revealed that children selected peer interaction partners with similar levels of preschool competency and were influenced over time by their partners' levels of preschool competency. These effects held even after controlling for several child (e.g., sex and language) and family factors (e.g., financial strain and parent education). Implications for promoting preschool competency among Head Start children are discussed.