Bullying has been recognized as one of the most tractable risk factors for poor mental health. Adolescents alreadyat risk for anxiety and depression are more likely to be targeted by bullies, though it is still unclear why; it is also not known whether they display greater sensitivity to the harmful consequences of bullying. If this is the case, then implementing effective anti-bullying interventions with targeted support for vulnerable youth should reduce the prevalence of depression and anxiety over time. Alternatively, adolescents with high levels of internalizing symptoms may be more likely to attribute hostile intent to peers’ actions, and thus over-perceive or over-report bullying. In real-world bullying scenarios, the objective reality is difficult to determine. A laboratory method of simulating negative and neutral peer interactions overcomes this difficulty. This talk will focus on the development of a novel virtual reality tool that simulates verbal bullying encounters in schools. If successful, this VR tool will provide a controlled environment in which to develop and test interventions to support vulnerable adolescents.