Aggressive behavior is common across childhood-onset psychiatric disorders and is associated with impairments in social cognition and communication. The present study examined whether amygdala connectivity and reactivity during face emotion processing in children with maladaptive aggression are moderated by social impairment. This cross-sectional study included a well-characterized transdiagnostic sample of 101 children of age 8-16 years old with clinically significant levels of aggressive behavior and 32 typically developing children without aggressive behavior. Children completed a face emotion perception task of fearful and calm faces during functional magnetic resonance imaging. Aggressive behavior and social functioning were measured by standardized parent ratings. Relative to controls, children with aggressive behavior showed reduced connectivity between the amygdala and the dorsolateral prefrontal cortex (PFC) during implicit emotion processing. In children with aggressive behavior, the association between reduced amygdala-ventrolateral PFC connectivity and greater severity of aggression was moderated by greater social impairment. Amygdala reactivity to fearful faces was also associated with severity of aggressive behavior for children without social deficits but not for children with social deficits. Social impairments entail difficulties in interpreting social cues and enacting socially appropriate responses to frustration or provocation, which increase the propensity for an aggressive response via diminished connectivity between the amygdala and the ventral PFC.