This study examines the impact chronic physical illnesses, such as asthma, rhinitis, atopic dermatitis, obesity, heart disease, and diabetes, have on the life goals of Korean adolescents, and evaluates the mediating effects self-esteem and peer relationship have in this regard. Data were sourced from the fifth wave of the Korea Child and Youth Panel Survey, which comprised 2,351 high-school adolescents, 42.5% of whom had a chronic physical illness. The major findings were: chronic physical illness has a positive association with adolescents’ intrinsic life goals, and self-esteem and peer relationship mediate the relationship between adolescents’ chronic physical illness and intrinsic life goals. Setting intrinsic life goals is essential for well-being, but the aspirations of adolescents with chronic physical illness are often constrained by their illness and treatment. This study revealed that, despite these constraints, adolescents with chronic physical illness who have higher self-esteem and high-quality friendships strive for positive and constructive life goals. Thus, the study suggests adolescents’ well-being can be enhanced through improving their self-esteem and peer relationships.