Youth’s perception of parents’ differential treatment (PDT) are associated with maladjustment during adolescence. Although the direct relations between PDT and youth’s maladjustment have been well established, the mechanisms underlying these associations remain unclear. We addressed this gap by examining whether sibling jealousy accounted for the links between PDT and youth’s depressive symptoms, self-worth, and risky behaviors. Additionally, we examined whether youth’s perceptions of fairness regarding their treatment as well as the gender constellation of the dyad moderated these indirect relations (i.e., moderated-indirect effects). Participants were first- and second-born adolescent siblings (M = 15.96, SD = .72 years for older siblings, M = 13.48, SD = 1.02 years for younger siblings) and their parents from 197 working and middle class European American families. Data were collected via home interviews. A series of Conditional Process Analyses revealed significant indirect effects of PDT through sibling jealousy to all three adjustment outcomes. Furthermore, perceptions of fairness moderated the relations between PDT and jealousy, such that the indirect effects were only significant at low (−1 SD) and average levels of fairness. At high levels of fairness (+1 SD) there was no association between PDT, jealousy, and youth adjustment. Taken together, results indicate that youth and parents would benefit from engaging in clear communication regarding the reasoning for the occurrence of differential treatment, likely maximizing youth and parent perceptions of that treatment as being fair and in turn mitigating sibling jealousy and maladjustment.