This study explores the prevalence and multilevel risk factors of 1,309 Israeli Arab and Jewish adolescents’ experiences of unwelcome sexual behaviors by peers in residential care settings (RCSs) for at-risk children. I examine the links between adolescents’ reports of sexual victimization, adolescents’ individual characteristics, and RCS-level characteristics using hierarchical linear modeling (HLM). Approximately 40 percent of adolescents reported having been victims of at least one sexually violent act by peers in the month prior to the survey. Adolescents with more adjustment difficulties, those who experienced more physical maltreatment by staff, and those who perceived the institutional antiviolence policy as less clear, fair, and consistent were at higher risk for peer sexual victimization. Sexual victimization by peers is also positively associated with concentrations of males and adolescents with adjustment difficulties and with residence in Jewish and group settings. The link between staff maltreatment and sexual victimization by peers was stronger among adolescents from Jewish than Arab RCSs.