Disparities in health and mental health between sexual-minority and heterosexual individuals emerge in early adolescence, in large part because sexual-minority individuals are stigmatized. In this article, I review and synthesize the role of gender nonconformity in shaping how adolescents experience the stigma associated with sexual-minority status. Then, I review research with adolescents and emerging adults that shows that gender nonconformity is associated with variation in harassment and mental health outcomes both within sexual-minority groups and between sexual-minority and heterosexual groups. Next, I discuss gender nonconformity as a construct that influences the association between sexual-minority status and peer relations, and between peer relations and individual psychosocial outcomes. Finally, I discuss the importance of addressing stigma related to gender nonconformity.