This paper evaluates the impact of a remedial education program performed in two Chinese migrant children schools. The program used a conditional cash transfer contract to encourage peer tutors to help their underperforming classmates. Incentivized peer-tutoring significantly improved the academic performance of the underperforming tutees over a semester. The impact persisted in the second semester when the intervention was removed. Our results suggest that nongovernment organizations and government agencies can increase their capacity of remedying education by incorporating incentivized peer-tutoring into their existing merit-based scholarship and conditional cash transfer programs. © 2012 Institute of Developing Economies.