Using qualitative data about University of Michigan between 1965 and 2005, this article shows how administrators' diversity discourse and programs have defined race as a cultural identity, expressed through interaction, which provides instrumental benefits. It also explains three major reasons why, starting in the mid-1980s, university administrators adopted this racial orthodoxy of "diversity": to signal compliance with-and also to redefine-law and institutional norms while still practicing race-based affirmative admissions; to frame inclusion in more complex terms than a racial binary or numerical representation amidst growing campus multiculturalism; and to market the university, especially to white students. The article advances racial formation theory by developing the concept of a racial orthodoxy. It shows that diversity discourse and programs have sometimes advanced the goal of racial minority inclusion, but at the cost of downplaying problems of racial inequality and misrepresenting racial minorities' campus experiences.