In the realm of sports, athlete wellbeing stands as a pivotal cornerstone for peak performance and personal growth. Within this context, the satisfaction of basic psychological needs (BPNs; i.e., autonomy, competence, and relatedness) plays a fundamental role. This study is rooted in self-determination theory and is the first to investigate how peer-created empowering climate (PCEC) and peer-created disempowering climate (PCDC) relate to BPN satisfaction and frustration. The study sample comprises 101 athletes from diverse team sports, including para- and non-para-athletes. Using adapted scales, the study cross-sectionally measures PCEC and PCDC as independent variables and BPN satisfaction and frustration as dependent variables in the context of team sports. The results show significant positive relationships between PCEC and BPN satisfaction across autonomy, competence, and relatedness. Conversely, PCDC shows positive relationships with BPN frustration regarding autonomy, competence, and relatedness. The research highlights the differential impacts of PCEC and PCDC on athletes’ needs, emphasizing how PCEC may positively influence satisfaction while PCDC relates to increased frustration. Notably, the study provides insights into the influential role of peers in meeting the basic psychological needs of athletes. These findings underscore the importance of interpersonal relationships in team sports and offer valuable insights for interventions to enhance athlete wellbeing and optimize performance.