Examined are recent advances in knowledge about children with peer relationship problems. Two specific developments are described: (1) an emerging recognition of the differences that exist between socially rejected versus neglected children; and (2) a growing appreciation for children's own perspectives on their social situations. The discussion is divided into four parts. The first section focuses on sociometric methods for identifying low-status children who may be experiencing difficulties in peer relations. The second section describes findings from recent studies on the behavioral correlates of children's peer status. In both the first and second sections, evidence is presented to support the distinction between rejected and neglected children. The third section of the paper surveys new information on the link between peer status and children's subjective sense of well-being. This information documents the importance of looking beyond observable aspects of children's social problems to consider the perceptions and feelings of the children themselves. The paper then ends with a discussion of techniques that have been found to be effective for helping children overcome problems in their peer relations. It is concluded that even though the focus of the paper is on problems, the underlying theme is quite positive. Parents and teachers should increase efforts to identify and help children who might be experiencing serious peer relationship problems. (RH)