In recent years, U.S. colleges and universities have observed a rapid expansion of the enrollment of international students. Particularly Chinese students, the largest group of international students since 2010, have increased nearly threefold in just eight years (Institute of International Education, 2010-2018). Prior studies have investigated the friendship networks of international students (Rose-Redwood & Rose-Redwood, 2013) and the influence of peer relations on international students' cross-cultural adaptation (Hendrickson, Rosen, & Aune, 2011). However, the extant literature has largely neglected to examine international students' lived experiences of establishing friendship networks and the underlying mechanism of the associations between friendships and international student adaptation. Guided by social capital theory (Lin, 1999) and acculturation process framework (Ward, Bochner, & Furnham, 2001), the purpose of my dissertation is to examine Chinese students' peer interaction patterns and how friendships influence their psychological well-being and sociocultural adjustment. My dissertation consists of two studies. The first study drew upon two waves of surveys collected with 46 Chinese students (30 females, Mage = 18.89, SD = .80) and multiple in-depth interviews conducted with five students (three females, Mage = 18.40, SD = .89). The results yield three main findings. First, Chinese students of the present study nominated predominant Chinese friends, much more than domestic and other international student friends, in both waves. Second, Chinese students did not necessarily develop more diverse, integrated friendship networks over time. Specifically, more than half of the participants nominated Chinese friends only in both waves, possibly because of language barriers and prior discrimination experiences. Lastly, the interview findings illustrated that Chinese students' engagement in college settings shaped their experiences of building friendship networks, such that greater engagement in meaningful common experiences (such as club activities, religious groups, and experiences of working together) could facilitate cross-cultural interaction between Chinese students and domestic students. Guided by social capital theory (Lin, 1999) and acculturation process framework (Ward, Bochner, & Furnham, 2001), the second study examined: (1) how friendship networks, specifically the national backgrounds of nominated friends, the frequency of contact, and the intimacy of friendships, are associated with psychological and sociocultural adaptation among Chinese undergraduates (N = 273, Mage = 19.18, SD = .84) in U.S. higher education; and (2) the role of social connectedness as a mediator. Results indicated that compared to superficial relationships, high-quality peer interaction (for example, friendships involving both frequent contact and intimacy) might be a key to bolster Chinese students' ability to navigate cross-cultural challenges. Further, social connectedness mediated the associations between friendships and student adaptation, such that frequent and intimate interaction with domestic students was associated with greater social connectedness and, in turn, better psychological and sociocultural adaptation. The findings point to practical implications for the host institutions, especially for universities enrolling large numbers of international students. It is important for the host institutions to develop corresponding programs to facilitate social opportunities for different groups to mingle and establish sustained friendships.