Group-based disparities in education and training, employment, health, and income persist even though there is growing attention to issues of race, gender, sexuality, and economic class by academics and the public at large. This chapter reviews the contributions made by cognitive psychology, namely social identity theory and social categorization theory, to our understanding of why differences matter. Furthermore, it seeks to provide greater attention to the social and cultural context in which meaning is ascribed and enacted to group differences through turning its focus to issues of privilege, power, and diversity ideologies, which complicate the cognitive dynamics typically explored. It also seeks to understand the experience of marginalization due to group membership through an examination of group-based discrimination through the lenses of identity development theory and subsequently intersectionality.