The current longitudinal study examined the association of temperamental inhibition (assessed by behavioral observation and parental reports) at three years old with reward and punishment bias (measured by a spatial cueing task) and mothers’ and teachers’ reports of internalizing behaviors and social competence at five years old in 153 Chinese children. As predicted, behavioral inhibition positively predicted later mother-rated internalizing behaviors. In addition, punishment bias moderated this relation such that children with higher punishment bias showed a positive inhibition–internalizing link. Furthermore, inhibition negatively predicted both mother-rated and teacher-rated social competence. However, novel findings were that reward bias moderated the relation between inhibition and teacher-rated social competence, such that inhibited children showed an increased risk of low competence when they had lower reward bias.