Objective: Mindfulness- and compassion-based interventions may represent a promising intervention approach to the global mental health crisis of forced displacement. Specifically, Mindfulness-Based Trauma Recovery for Refugees (MBTR-R)-a mindfulness- and compassion-based, trauma-sensitive, and socioculturally adapted intervention for refugees and asylum-seekers-has recently demonstrated randomized control evidence of therapeutic efficacy and safety. Yet, little is known about potential mechanisms underlying these therapeutic effects for trauma recovery and for refugees and asylum-seekers. Method: Thus, we examined adaptive and maladaptive forms of self-referentiality, namely self-compassion and self-criticism, as mechanisms of action for trauma recovery in a randomized wait-list control trial of MBTR-R among a community sample of 158 traumatized and chronically stressed asylum-seekers (46% female) in an urban postdisplacement setting (Middle East). Self-compassion and self-criticism were measured vis-a-vis an experimental Self-Referential Encoding Task (SRET) designed to quantify cognitive processes underlying self-compassion and self-criticism using diffusion modeling, a computational modeling approach to quantify cognitive processes underlying decision-making from behavioral reaction time data. Results: Findings indicate that self-compassion and self-criticism were associated with trauma- and stress-related psychopathology at preintervention. Relative to wait-list controls, MBTR-R led to significant elevation in self-compassion, and reduction in self-criticism, from pre to postintervention. Finally, pre to postintervention change in self-criticism significantly mediated therapeutic effects of MBTR-R on depression and posttraumatic stress disorder (PTSD) outcomes, while pre to postintervention change in self-compassion only mediated therapeutic effects on PTSD outcomes. Conclusions: Findings speak to the importance of (mal)adaptive self-referentiality as a target mechanism in MBIs and trauma recovery broadly, and among refugees and asylum-seekers specifically. What is the public health significance of this article? In a randomized wait-list control trial, we found that self-compassion and self-criticism were associated with stress- and trauma-related mental health symptoms, were therapeutically engaged by the intervention and mediated intervention effects of Mindfulness-Based Trauma Recovery for Refugees (MBTR-R), among traumatized East African asylum-seekers residing in the Middle East (Israel). Findings demonstrate the importance of self-compassion and self-criticism as malleable factors in trauma recovery, and as candidate mechanisms of action of mindfulness and compassion training, among diverse forcibly displaced people. More broadly, the study and findings highlight the need and importance of clinical science as instrumental in efforts to address the global public mental health crisis of forced displacement.