Children with hearing loss are at risk for developing psychosocial problems. Children with mild to severe hearing loss are less frequently subject to research, in particular in preschool, and we therefore know less about the risk in this particular group. To address this, we compared psychosocial functioning in thirty-five 4–5-year olds with hearing aids to that of 180 typically hearing children. Parent ratings of psychosocial functioning and social skills, as well as scores of receptive vocabulary, were obtained. Children with hearing loss evidenced more psychosocial problems than hearing agemates. Female gender and early detection of hearing loss predicted better psychosocial functioning among children with hearing loss, whereas vocabulary and degree of hearing loss did not. Early intervention addressing psychosocial functioning is warranted for children with all degrees of hearing loss, including mild and moderate. Gender differences should be investigated in future research.