Latent growth-mixture modeling was used to investigate patterns of change in loneliness for 170 children from third through fifth grades. A three-class model representing unique trajectories of loneliness provided the best overall fit to the data, including a Stable Low group (65%), as well as groups of Increasers (23%) and Decreasers (12%). Groups were then compared on aspects of peer functioning, including peer optimism, classroom sociometric ratings, and peer behavior nominations that were also collected in third, fourth, and fifth grades. The Stable Low group was characterized by positive peer functioning (elevated peer optimism, below-average victimization and passive social withdrawal nominations, and above-average mutual friendships). The Increasers had elevated passive social withdrawal and later victimization nominations, and possibly represent a subgroup of children at risk for developing later internalizing symptomatology. The Decreasers had a less clear pattern of peer functioning in third grade but were indistinguishable from the Stable Low group by fourth and fifth grades. Findings are discussed in the context of the development of loneliness in middle childhood. (Contains 1 figure and 3 tables.)