<p>Conflicts and transgressions are inevitable features of the human experience, with well-established negative social, interpersonal, and intrapersonal consequences if they are not adequately resolved. This study tested whether the effectiveness of two adaptive traits typically observed in research with adults—forgiveness and self-forgiveness—would generalize to youth and adolescents, specifically in relation to their psychological wellbeing (hope and life satisfaction) and psychological distress. Notably, the study makes two new contributions: It tests relations with a large nationwide representative sample, and it examines the moderating effects of variables likely to be important considerations in the school context and often where conflict arises, namely school engagement, and student age and gender. There were <i>N</i> = 79,670 participants aged 7–18 years (<i>M</i>_<i>age</i> = 12.05 years; <i>SD</i> = 2.63; modal age=11 years; 51% Female; majority Ethnic background White, i.e., 70.1%). Moderating effects of gender, age and school engagement were also analyzed. Associations between forgiveness/self-forgiveness and mental health were largely consistent with adult studies. There were consistent effects for all moderators on the relation between forgiveness and self-forgiveness and mental health outcomes, albeit in practical terms they are mostly negligible (<i>f</i>² = 0 to 0.003). Most notably, self-forgiveness and mental health – particularly distress – were more closely linked in students who were female, less engaged, and older (<i>f</i>² = 0.02). These big data findings provide firm evidence that, like adult samples, forgiveness and self-forgiveness are factors in promoting psychological wellbeing, at least among Westernized youth and adolescents.</p>