Vulnerability, scar, and reciprocal-relations models of depressive symptoms and self-esteem were compared among people with severe mental illness (SMI; N=260) participating in a partnership-based intervention study. Assessments were conducted at baseline, midway through the intervention (after 4 months), and at termination (after 9 months). Cross-lagged, structural equation modeling analyses revealed that participants' baseline depressive symptoms predicted a decrease in self-esteem in the first 4 months but not in the subsequent 5 months of participation. Exploratory regression analyses indicated that improved social functioning buffered this deleterious effect of depressive symptoms. These findings, which are consistent with the scar model, highlight the fragile nature of the self and the importance of social functioning in recovery from SMI.