Steele's (1992, 1997) stereotype-threat theory attempts to explain underperformance of minority students in academic domains and of women in mathematics. Steele argues that situational self-relevance of negative group stereotypes in testing situations increases the anxiety these students experience and that these differential anxiety levels explain performance differences. Research shows that manipulation of stereotype threat can affect academic performance. However, there has been little research testing whether anxiety does at least partially explain the relationship between race and achievement. The goal of this study was to examine whether anxiety will explain racial differences in academic performance and gender differences in math performance in the context of a nationally representative sample of high school seniors. Partial mediation was observed, with anxiety explaining significant portions of the racial differences in academic performance. Anxiety also partially explained sex differences in math achievement, although the effect sizes were very small. These results provide general support for Steele's stereotype-threat hypothesis. Copyright 2001 Academic Press.