In this chapter, pediatric diseases are defined as “illnesses that affect a person for an extended period of time, often for life, and that require medical care attention above and beyond the normal requirements for a child or adolescent” (American Academy of Pediatrics 1993). The prevalence of such chronic illnesses has steadily increased over the past 20–30 years (Downs et al. 2001; Vincer et al. 2006; Marelli et al. 2007), with estimated rates ranging from below 1% to 44% depending on the definition, method, and sample included in the different studies (van der Lee et al. 2007). Several theoretical frameworks and models have been presented to explain how diagnosis-specific effects and generic factors across disorders affect cognition and behavior. The transactional stress and coping model (TSC) is one of the most cited theories on psychological adaption in children with a chronic illness, encompassing both specific and generic effects (Thompson and Gustafson 1996). Dennis (2000) has presented a similar model of factors affecting cognitive outcome in chronically ill children. The models describe how disease-related variables interact with child characteristics, developmental level, family resources, and peer relationships, and provide a useful framework to the present chapter. Several epidemiological and clinical studies have documented that children with pediatric diseases have an increased risk of emotional and behavioral problems (Lavigne and Faier-Routman 1992; Glazebrook et al. 2003; Hysing et al. 2007). Symptoms of internalizing and externalizing disorders are frequently found across the diseases but illness-specific manifestations also exist. Externalizing symptoms of hyperactivity and social problems are most often shown by children with neurological disorders (Rodenburg et al. 2005), while the rate of emotional problems has been reported to be especially high in children with asthma (Vila et al. 2003). Peer interaction and social functions are often affected in children with pediatric disorders. Investigations of the impact of social functioning is a growing research field in pediatric psychology, as part of a general trend in developmental psychology that focuses on close peer relationship as a moderator of nonoptimal functioning (Bukowski and Adams 2005; Burt et al. 2008).