Even though she correctly spelled "googol" and "epistolary" in the second and third rounds, she did not accumulate enough points through three rounds to reach Thursday's semifinals.
Snighda Nandipati, 14, of San Diego, won the competition by correctly spelling "guetapens," which means "an ambush, snare or trap."
This was the second time Margaret competed in the National Spelling Bee.
Her sister Caroline, 14, competed in last week's National Geographic Bee in nearbyWashington, D.C.That event was won by Rahul Nagvekar, 14, of Sugarland, Texas.
The Peterson sisters are home-schooled students and the children of Kate and Waylon Peterson.