In non‐gang populations, the degree of identification with an in‐group and perceptions of out‐group entitativity, the perception of an out‐group as bonded or unified, are important contributors to group‐based aggression or vicarious retribution. The link between these factors and group‐based aggression, however, has not been examined in the context of street gangs. The current study assessed the relationship among in‐group identification, perceptions of out‐group entitativity, and the willingness to retaliate against members of rival groups who did not themselves attack the in‐group among juvenile gang and non‐gang members in London. Our results showed the predicted membership (gang/non‐gang) × in‐group identification × entitativity interaction. Decomposition of the three‐way interaction by membership revealed a significant identification × entitativity interaction for gang, but not for non‐gang members. More specifically, gang members who identify more strongly with their gang and perceived a rival group as high on entitativity were more willing to retaliate against any of them. In addition, entitativity was a significant predictor of group‐based aggression after controlling for gender, in‐group identification, and gang membership. Our results are consistent with socio‐psychological theories of group‐based aggression and support the proposal that such theories are applicable for understanding gang‐related violence. Aggr. Behav. 9999:XX–XX, 2015. © 2015 Wiley Periodicals, Inc.