The increase in ethnic diversity in America has created the opportunity for people to have more repeated, sustained personal interactions with out-group members at school, work, and in community settings. In some cases, these interactions lead to close interethnic friendships, which have been shown to reduce prejudice, but in other cases, these interactions are stressful for individuals, deterring interethnic friendships from developing. We continue to know very little about the processes that occur during repeated interracial interactions that may lead to or prevent the development of friendships. This is primary because the majority of research on intergroup contact involves brief, single-shot approaches (e.g., contact between out-groups in the laboratory) or uses survey methodology. The first goal of the proposed research is to develop an understanding of the experiences of individuals as they move from initial interracial interactions with acquaintances to having multiple personal contact experiences with the same out-group member, perhaps resulting in interracial friendships. A second goal of the proposed research is to unpack why daily interracial interactions are stressful for individuals, especially for ethnic minorities, preventing interracial friendships from developing. Three studies are proposed that are longitudinal in design, and include repeated samplings over the period of study. This research will provide a rich data set for understanding the dynamic nature of interactions over time and their potential effects on social, academic and health-related outcomes.