Objective National and international policies claim that young people's sports participation improves their social capital. This article is the first to examine if sports participation has a causal effect on social capital formation during adolescence and whether such effects depend on the organizational format or the type of sports practiced. Methods Propensity score matching is employed in the analysis with possible endogeneity removed by exploiting the information in, and the structure of, the German Socio‐Economic Panel. Results Regular sports participation positively impacts adolescents’ social capital through volunteering, helping friends, and civic involvement. Furthermore, these effects seem to develop predominantly in sports clubs (in contrast to other organizational formats). Conclusion The empirical evidence of this study is suggestive of the relevant societal role of nonprofit clubs as institutions for practicing sport.