The aim of this study was to investigate the effects of friendship and dominance status on interaction quality—harmony and conflict during play—among preschool-aged children. The study considered the effects of friendship and dominance on the degree of conflict and harmony in dyadic interactions. Behavioral traits (i.e., outside dyad general interaction tendency), demographic factors (i.e., age and sex composition), and socio-emotional characteristics (i.e., affect expressiveness and social competence) of dyads were included in the analysis to control for their potential impact on dyadic-level variance. The methods included direct observation of social interaction, interviews with children, and ratings of friendship and dominance by teachers. Participants were 385 children (36- to 60-months of age; 1784 dyads). Demographic and relational characteristics of dyads were associated with the frequency and intensity of interaction qualities as main effects and but not as interaction effects: (1) older children engaged in more frequent but less intense conflicted interaction and more frequent harmonious interaction than younger children; (2) girl-girl dyads engaged in more frequent harmonious interaction and boy-boy dyads engaged in more frequent and more intense conflicted interaction; (3) established friendship (as noted by two teachers) was associated with more frequent conflict and more intense harmony than a friendship noted by only one teacher or a lack of friendship in a dyad; (4) dyads with established paired dominance engaged in less frequent harmony and more intense conflict than dyads of equals. Relationship status variables predicted interaction qualities above and beyond demographic, behavioral, and socio-emotional characteristics of dyads individually such that (1) friendship made a unique contribution to the frequency of harmony and (2) dominance made a unique contribution to the intensity of conflict.