Peer victimization has been demonstrated to have a long-lasting negative impact on adolescents’ psychological well-being, yet its impact on school engagement is inconclusive, particularly during high school. In addition, research about the role of classroom-level victimization in the association between individual-level peer victimization and adolescents’ school engagement remains underexplored. Previous research has relied solely on self-report measures to assess peer victimization, potentially limiting the scope of understanding. This study investigated the moderating effects of both student-reported and teacher-reported classroom-level victimization on the association between individual-level peer victimization and school engagement among Chinese adolescents. A sample of 2,803 high school students (aged from 14–19 years, Mage = 15.43 years, SD = 0.56; 48.5% boys) from 48 classes (Mclass size = 58.62, SD = 3.65) completed measures of peer victimization and school engagement in October 2023. Their homeroom teachers (85.4% males; Mage = 44.17 years, SD = 7.70) reported overall victimization in each class. Multilevel modeling analyses revealed that, at the individual level, adolescents who reported higher victimization exhibited lower school engagement. Notably, this association was significant only when the classroom-level victimization was high. Furthermore, these significant findings were observed for student-reported classroom-level victimization, but not for teacher-reported victimization. The findings suggest that reducing classroom-level victimization may help mitigate the negative effect of peer victimization on school engagement, underscoring the need to consider classroom environment when developing anti-bullying interventions for high school students.