This study examined the mediating effect of friends' characteristics (problem behavior and academic achievement) in the association between students' background (family and individual factors) and later academic adjustment, as operationalized by problem behavior and academic achievement. We recruited 998 participants in three public middle schools and used three annual waves of data collection (Grades 6, 7, and 8). We found that students' own academic achievement and problem behavior are predictors of later adjustment. Friendship choices are identified as a mediation mechanism that contributes to consistent adjustment from the beginning to the end of middle school. Specifically, high-achieving students in Grade 6 tend to associate with high-achieving friends and are unlikely to associate with friends who exhibit problem behavior in Grade 7, which results in continued achievement in Grade 8. Associating with high-achieving friends in Grade 7 also mediated the link between adolescent problem behavior in Grade 6 and academic achievement by Grade 8. Friends' characteristics in Grade 7 did not mediate the effect of any family factor measured in Grade 6. In general, our results suggest friendship selection is central to sustained success throughout the middle school years.