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The study examined the relationship between social rejection by peers, personal resources (potency and perceived social support) and psychological distress among Israeli adolescents.Five hundred and eleven adolescents aged 12–17 (high-school students from two rural Israeli schools) completed self-report questionnaires consisting of the following measures: peer rejection (PR; ranged from having been ignored, cursed, assaulted, bullied, to having been physically attacked), posttraumatic symptoms (PTS), social avoidance, depression symptoms, potency and perceived social support.Thirty-five percent of the students reported experiencing some kind of social rejection (SR). One-way ANOVA and stepwise linear regression tests showed that those who experienced SR had higher levels of depression, PTS symptoms, and social avoidance compared to those who had no such history. In addition, personal resources, potency in particular was found to mediate the distress.Findings indicated that adolescents who reported experiencing peer rejection had higher levels of psychological distress. In addition, the lower the personal resources were, the higher the levels of psychological distress. Potency buffered the level of distress resulting from social rejection by peers. Compared to boys, rejected girls had lower potency levels.