Workforces are becoming increasingly diverse and leaders face the challenge of managing their groups to minimize costs and maximize benefits of diversity. This paper investigates how leaders’ multiculturalism and colorblindness affect cultural minority and majority members’ experiences of connectedness (feeling accepted or distancing from group) and relationship conflict in their group. We collected data from 29 culturally diverse student work groups and their leaders. We used repeated measures (baseline and follow-up) of group functioning and independent measures of members’ and leaders’ diversity perspectives. Multilevel analyses revealed that leaders’ diversity perspectives affect work group functioning, controlled for members’ own perspectives: Leaders’ multiculturalism predicted feeling accepted in the group for minority members. In contrast, leaders’ colorblindness predicted distancing from the group and relationship conflict for minority members. There were no significant effects of leaders’ diversity perspective on majority members and no reverse effects of prior group functioning on leaders’ diversity perspectives.