This study examines mechanisms underlying nationality-based discrimination from two different perspectives: social psychology and microeconomics. The authors studied 91 teams in a binational setting that were offered a new team member. National composition of the team and nationality of the new member were manipulated. Overall, the study showed that discrimination based on nationality does exist in such a setting. A new member is more likely to be accepted when belonging to the majority nation represented in the team. The chances of acceptance do not increase if the newcomer belongs to the national group that is expected to perform better. Furthermore, the authors found a general tendency to close ranks when team members strongly identify with the team, when competition is high, and when success is attributed to team effort. The results underline the importance of understanding social-psychological mechanisms for explaining nationality-based discrimination in teams.