We hypothesize that the manner in which stereotype threat affects collegegrade achievement is mediated by institutional context as well as individual characteristics. Drawing on a sample of black students from the National Longitudinal Survey of Freshmen, we find weak and inconsistent evidence that institutional characteristics influence the operation of stereotype threat. We find more consistent evidence to indicate that the effect of stereotype threat is conditioned by individual factors such as skin colour, multiracial origins and an integrated upbringing. Most of the effect on grade achievement occurs through the internalization pathway, in which the internalization of negative stereotypes leads to disinvestment manifested by a reduction in academic effort. The reduction in work effort, in turn, lowers grades. We also find evidence that immigrant origin confers protection from the negative effects of stereotype threat through both internalization and externalization mechanisms, although the ultimate effect of grade achievement is rather small.