The climate of school classrooms, shaped by a combination of teacher practices and peer processes, is an important determinant for children's psychosocial functioning and is a primary factor affecting bullying and victimization. Given that there are relatively few theoretically-grounded and validated assessment tools designed to measure the social climate of classrooms, our research team developed an observation tool through participatory action research (PAR). This article details how the assessment tool was designed and preliminarily validated in 18 third-, fourth-, and fifth-grade classrooms in a large urban public school district. The goals of this study are to illustrate the feasibility of a PAR paradigm in measurement development, ascertain the psychometric properties of the assessment tool, and determine associations with different indices of classroom levels of relational and physical aggression.