Social network analysis and multilevel modeling were used to examine the formation of homophobic name-calling behavior in adolescents. Specifically, peer group contextual and socialization effects on homophobic name-calling as well as the influence of masculinity attitudes, general bullying perpetration, and victimization were tested. Participants included 493 fifth- through eighth-grade students from two middle schools. Results indicated that peer groups play an important role in the formation of homophobic name-calling. Additionally, students who were victims of homophobic name-calling over time increased their own perpetration of homophobic name-calling. Non-homophobic bullying was also related to homophobic name-calling, but only for male peer groups. And finally, the role of masculinity attitudes was shown to be complex, as peer group masculinity attitudes were significantly predictive of an individual's homophobic perpetration; however, this effect did not remain significant over time. Results suggest that homophobic name-calling during early adolescence is strongly influenced by peers and rooted in gender and masculinity.