Recent research suggests that the relationship between job insecurity and psychological outcomes is more negative among permanent compared with temporary workers. We investigate possible interaction effects between job insecurity and type of contract (temporary versus permanent) for various psychological outcomes (job satisfaction, organizational commitment, life satisfaction, and self-rated performance), some of which have received little attention. We aim to explain these interaction effects, while taking into account the heterogeneous nature of temporary workers in terms of tenure, employment prospects, and wish to do temporary employment. We argue that permanent workers expect higher levels of job security, job insecurity breaches permanent workers' but not temporary workers' expectations. This may relate to unfavourable outcomes. Similarly, the heterogeneous nature of temporary workers may relate to job security expectations and thus to reactions to job insecurity. This study was conducted on a sample of 477 temporary and permanent workers from various occupational sectors in Belgium. The results suggested that the interaction effect between job insecurity and contract type may be limited to job satisfaction and organizational commitment. Furthermore, permanent workers had higher expectations about job security. Breach of these expectations furthermore mediated the relationship between job insecurity and all outcomes, except for self-rated performance. However, the heterogeneity indicators were found to be unrelated to job security expectations.