We hypothesize that individuals who self-identify with one racial group but are routinely perceived by observers as “looking like” another racial group may experience negative outcomes associated with this stressful situation. Since American Indians experience very high rates of misclassification, we use them as our case in point. Drawing from the National Longitudinal Survey of Adolescent Health, our analyses compare young American Indian adults who are perceived as another race by an observer to those who are correctly classified, using several indicators of psychological distress: depression, suicidal thoughts, use of psychological counseling services, suicide attempts, and fatalism. We also investigate differences in racial attitudes and behaviors, such as belonging to an ethnic solidarity organization or believing it is important to have a committed relationship with someone of the same race. The evidence suggests that, onthe whole, misclassified American Indians have higher rates of psychological distress. We conclude by discussing our findings and their wider implications, especially in the context of an increasingly heterogeneous and multiracial society.