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Mental health services are increasingly employing peer workers (PWs), individuals who have lived experiences with mental health problems, to support patients and be part of mental health care teams. While the employment of PWs continues to increase, little is known about how the function unfolds in practice. This paper explores the broader context in which the PWs navigate and the concrete outcomes and everyday issues that exist at the individual level. Methodologically, the paper draws on 22 interviews with PWs employed in the mental health services in Denmark. Theoretically, it combines Lipsky's (1980) theory on street-level bureaucrats with sociological discussions concerning the lay-expert divide. The analysis shows that PWs experience both role ambiguity and goal uncertainty and that they use substantial discretion in determining the nature, amount and quality of their peer practices. This – combined with the PWs' diverse lived experiences – calls for a heterogeneous understanding of peer work and therefore the analysis presents three categories of peer workers: PWs as (1) a representative of patients' lifeworld, (2) an interdisciplinary professional and (3) an 'expert by experience'. These categories display PWs different enactments of their lived experiences and reveal ambiguities tied to the lay-expert divide. [ABSTRACT FROM AUTHOR]