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This research examined whether peer relationships amongst ethnic minority status children reflect the social groups to which children belong and the degree to which they identify with these groups. A longitudinal study was conducted to investigate the influence of group identities (i.e., ethnic and national) on children's perceived peer acceptance and preference for same-ethnic friendships. Measures of ethnic and English identification, perceived peer acceptance, and friendship choice were administered to 207 south-Asian English children, aged between 5 and 11, at two time points 6 months apart. In line with predictions, longitudinal analysis showed that bicultural identification (i.e., higher ethnic and English identity) was related to higher perceived peer acceptance and less preference for same-ethnic friendships. Importantly, as hypothesized, this finding was limited to the older children with more advanced social-cognitive abilities. The results suggest that older children who adopted a bicultural identity were able to strategically "flag" their multiple group identities, within their multicultural peer groups, to obtain acceptance amongst the maximum number of peers and show less preference for same-ethnic friendships. This study extends previous peer relations research, which has typically focused on individual social deficits or classroom norms, by showing that group identities influence peer relationships amongst ethnic minority status children. (Contains 4 tables and 4 figures.)