Previous research has demonstrated that poor academic performance is associated with a downward shift in preferred level of academic comparison level (ACL). The current study assessed the long-term impact of this downward shift on the academic performance of college students and also examined the extent to which optimism moderated the relation between ACL and performance. Results indicated that a decline in academic performance led to a decline in preferred ACL, but only among students who were low in dispositional optimism. Change in ACL in turn, was prospectively linked (positively) with change in academic performance for low optimists and marginally for high optimists. Additional analyses suggested this relation was mediated by performance expectations. Finally, change in ACL was also indirectly linked with depression for low optimists. Thus, low optimists who raised their ACLs had higher subsequent grade point averages and experienced a decrease in depression. The relations between levels of preferred comparison and outcome, and possible mediators of these relations, are discussed.