Research has consistently shown that difficulties in facial emotion recognition (FER) are associated with peer problems and internalizing symptoms during middle childhood. However, no longitudinal research has investigated the direction of effects, that is, how these constructs influence each other across time. In this preregistered three-wave panel study, we tested the directional effects between FER, peer problems, and internalizing symptoms among Finnish school-aged children (n = 3,607; Mage = 8.20, SDage = 0.86; 51% female). The results of random-intercept cross-lagged panel models showed that a low FER accuracy and high biases toward happiness and sadness correlated with higher levels of peer problems and internalizing symptoms at the between-person level. However, we found no evidence of directional effects at the within-person level. Overall, our findings suggest that these constructs might be associated because of shared underlying causes, rather than mutually influencing one another in middle childhood.