Background: In situations of ongoing violence, childhood psychosocial and mental health problems require care. However, resources and evidence for adequate interventions are scarce for children in low- and middle-income countries. This study evaluated a school-based psychosocial intervention in conflict-affected, rural Nepal. Methods: A cluster randomized controlled trial was used to evaluate changes on a range of indicators, including psychiatric symptoms (depression, anxiety, posttraumatic stress disorder), psychological difficulties, resilience indicators (hope, prosocial behavior) and function impairment. Children (n = 325) (mean age = 12.7, SD = 1.04, range 11-14 years) with elevated psychosocial distress were allocated to a treatment or waitlist group. Results: Comparisons of crude change scores showed significant between-group differences on several outcome indicators, with moderate effect sizes (Cohen d = 0.41 to 0.58). After correcting for nested variance within schools, no evidence for treatment effects was found on any outcome variable. Additional analyses showed gender effects for treatment on prosocial behavior (mean change difference: 2.70; 95% CI, 0.97 to 4.44), psychological difficulties (-2.19; 95% CI, -3.82 to -0.56), and aggression (-4.42; 95% CI, -6.16 to -2.67). An age effect for treatment was found for hope (0.90; 95% CI, -1.54 to -0.26). Conclusions: A school-based psychosocial intervention demonstrated moderate short-term beneficial effects for improving social-behavioral and resilience indicators among subgroups of children exposed to armed conflict. The intervention reduced psychological difficulties and aggression among boys, increased prosocial behavior among girls, and increased hope for older children. The intervention did not result in reduction of psychiatric symptoms.