The authors use a multilevel framework to introduce peer-based control as a motivational state that emerges in self-managing teams. The authors specifically describe how peer-based rational control, which is defined as team members perceiving the distribution of economic rewards as dependent on input from teammates, extends and interacts with the more commonly studied normative control force of group cohesion to explain both individual and collective performance in teams. On the basis of data from 587 factory workers in 45 self-managing teams at 3 organizations, peer-based rational control corresponded with higher performance for both individuals and collective teams. Results further demonstrated that the rational and normative mechanism of peer-based control interacted to explain performance at both the individual and team levels. Increased peer-based rational control corresponded with higher individual and collective performance in teams with low cohesion, but the positive effects on performance were attenuated in cohesive teams.