["Strategic Management Journal, EarlyView. ", "\nAbstract\n\nResearch Summary\nOrganizations have become increasingly ethnically diverse, and this diversity often brings together distinct technological competencies. Understanding how firms can leverage such diversity to produce valuable innovations therefore becomes essential. This study investigates how ethnic integration within inventor collaboration networks, and its interaction with ethnic diversity, influence the economic value of innovation. Using patent and co‐inventor data from 890 publicly traded U.S. firms (1990–2015), we construct a network‐based index of ethnic integration, defined as the ratio of cross‐ethnic to within‐ethnic co‐invention ties, and link it to stock market reactions surrounding patent grants. We find that ethnic integration significantly enhances patent value, particularly in firms that are both ethnically diverse and engaged in technologically complex innovation. These findings are robust to an instrumental‐variables strategy addressing potential endogeneity concerns. By distinguishing between workforce composition and collaborative structure, our study advances the literature on diversity and innovation and underscores the critical role of integration mechanisms in unlocking the full potential of diverse organizations.\n\n\nManagerial Summary\nOrganizations have become increasingly ethnically diverse, and this diversity brings distinct technological competencies; yet many still struggle to translate diversity into measurable innovation outcomes. This study shows that how diverse talent collaborates is just as critical as who is on the team. Analyzing over 20 years of patent data from 890 U.S. public companies, we find that firms where inventors frequently collaborate across ethnic lines—what we call ethnic integration—generate significantly more valuable innovations. This effect is especially strong in firms tackling complex technologies, where integrating diverse knowledge is crucial. Importantly, diversity without integration offers limited returns. For leaders, the key takeaway is clear: investing in diverse talent is not enough. Organizations must also build collaborative cultures and structures—from inclusive leadership and cross‐ethnic mentorship to team design and onboarding practices—that enable integration. In high‐tech and R&D‐intensive industries, integration is not optional; it is a strategic lever for innovation performance.\n\n"]