Although childhood shyness has been associated with school-adjustment difficulties in contemporary research in China, the conceptual mechanisms that may underlie these relations remain underinvestigated. The goal of this study was to examine a complex theoretical model that explicates the roles of both peer preference and teacher-child relationships in the links between shyness and school adjustment in Chinese children. Participants were N = 1,275 3rd- through 7th-grade students (637 boys, 638 girls; M[subscript age] = 10.78 years, SD = 1.55) attending public primary and secondary schools in Shanghai, People's Republic of China. Measures of shyness, peer preference, teacher-child relationships, and aspects of school adjustment were obtained from multiple source, including peer nominations, child self-reports, teacher ratings, and school records. Results from mediation and moderated mediation analyses demonstrated that (a) shyness indirectly predicted greater internalizing problems and poorer academic achievement through its negative association with peer preference and (b) these indirect effects were moderated by teacher-child relationships, such that the negative association between shyness and peer reference was attenuated among children with higher quality of teacher-child relationships. Results are discussed in terms of the roles of peers and teachers in the links between shyness and school adjustment and their educational implications.