A large body of literature suggests a clear, concurrent association between peer approval and self-esteem in adolescence. However, little empirical work exists on either the prospective or reciprocal relation between peer approval and self-esteem during this age period. Moreover, it is unclear from past research whether both subjectively perceived peer approval and objectively measured peer approval are related to subsequent self-esteem over time (and vice versa) and whether these paths have long-term associations into adulthood. Using data from a large longitudinal study that covers a time span of 2 decades, we examined reciprocal, prospective relations between self-esteem and peer approval during ages 12–16 in addition to long-term relations between these variables and later social constructs at age 35. Cross-lagged regression analyses revealed small but persistent effect sizes from both types of peer approval to subsequent self-esteem in adolescence, controlling for prior self-esteem. However, effects in the reverse direction were not confirmed. These findings support the notion that peer relationships serve an important function for later self-esteem, consistent with many theoretical tenets of the importance of peers for building a strong identity. Finally, we found long-term relations between adult social constructs and adolescent objective and subjective peer approval as well as self-esteem. Therefore, not only do peer relationships play a role in self-esteem development across adolescence, but they remain impactful throughout adulthood. In sum, the current findings highlight the lasting, yet small link between peer relationships and self-esteem development and call for investigations of further influential factors for self-esteem over time.