Physical victimization by peers was examined among 1,324 Jewish and Arab adolescents, aged 11 to 19, residing in 32 residential care settings (RCS) for children at-risk in Israel. Hierarchical Linear Modeling (HLM) was used to examine the relationships between physical victimization and adolescents’ characteristics (age, gender, self-efficacy, adjustment difficulties, maltreatment by staff, and perceived social climate) as well as institution-level characteristics (care setting type, size, structure, and ethnic affiliation). For this study, we define physical violence as being grabbed, shoved, kicked, punched, hit with a hand, or hit with an object. Over 50% (56%) of the adolescents surveyed reported having experienced at least one form of physical violence by peers. Boys and younger adolescents were more likely to be victimized than girls and older adolescents. The results show that adolescents with adjustment difficulties or low social self-efficacy, and adolescents who perceive an institution’s staff as strict and/or had experienced maltreatment by staff, are vulnerable groups for peer victimization. Lower levels of victimization were found in RCS with a familial element than in traditional group settings. Institutions with high concentrations of young people with adjustment difficulties and violent staff behaviors had higher levels of violence among residents. Applying an ecological perspective to an investigation of peer victimization in RCS enables the identification of risk factors at adolescent and institution levels. This type of examination has implications for child welfare practice and policy that can help in the development of prevention and intervention methods designed to tackle the involvement in violence of youth in care.