Military veterans frequently experience traumatic, highly stressful events; thus, it is especially important for them to find positive ways of making meaning from these experiences. The present study used the methods of narrative personality psychology to investigate the associations between veterans' narrative processing of highly stressful and significant events from their military service and postdischarge functioning, including posttraumatic stress symptoms (PTSS). United States military veterans (N = 154; M age = 64.28 years, 86.4% men, 57.8% deployed) completed an online survey in which they wrote narratives about one "highly stressful" and one "key scene" military service memory and completed questionnaires to assess PTSS, symptoms of depression and anxiety, functional impairment, and well-being. Narratives were coded for personal growth from the experience, themes of agency and interpersonal communion, affective tone, and coherence. In the highly stressful narratives, small-to-moderate negative associations emerged between both growth and agency and PTSS, depression and anxiety, and functional impairment; growth was also modestly positively associated with well-being. In contrast, affective tone and communion were each only associated modestly with one outcome, and coherence with none, and narrative processing of the key scene narrative was not linked with any mental health outcomes. These findings suggest that (1) the theory and methods of narrative identity research are relevant for studying trauma narratives, and (2) veterans who narrate themselves as growing from and exerting control over their most stressful service experiences may achieve better mental health and day-to-day functioning.