In this study, ethnic identity, stereotype threat, and perceived discrimination were examined in relationship to academic achievement and hopelessness in a sample of 129 Native American adolescents aged 14–19. Regression analyses with self‐reported data indicated two major findings. Ethnic identity interacted with stereotype threat to predict academic achievement, where participants with high ethnic identity and low stereotype threat scores reported higher grade point averages. Ethnic identity also interacted with perceived discrimination to predict hopelessness, where participants with low ethnic identity and high perceived discrimination scores were higher in hopelessness. Findings are discussed in light of the joint role that ethnic identity and perceived bias have in relationship to developmental outcomes in Native American adolescents.