Because diverse school settings provide students with opportunities to form same- and cross-group relationships with youth of various ethnicities and races, an important question arises: How are these opportunities taken up, and what are the developmental implications of doing so? Accumulating evidence suggests that these connections are beneficial to youth. Yet, we currently have a limited understanding of the specific peer mechanisms that produce these benefits. Addressing this gap requires adopting a relational perspective and using social network analysis (SNA) tools to characterize the theorized developmental mechanisms through which intergroup connections promote adolescent psychological and academic adjustment. To do so, we present an integrative account in which intergroup connections are viewed as developing and influencing adolescent outcomes in the context of broader peer networks. We then discuss the need to disentangle peer network selection from peer influence dynamics to provide an accurate account of multiple processes through which intergroup connections shape development and briefly explore how these goals are achieved by using statistical approaches to modeling of social networks. This review seeks to guide the next generation of research to more thoroughly test and refine the developmental theory and advance knowledge that will inform interventions to promote intergroup connections and their academic and socio-emotional benefits.