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This qualitative case study examines how departmental racial climates influence faculty racial diversity in U.S. higher education. Drawing on Ray's (2019) theory of racialized organizations, and Griffin's (2020) model for faculty diversity, we explore structures, practices, and leaders' agency in shaping the climate. Two departments were compared, revealing the pivotal role of leaders and organizational structures in influencing climates in Natural Science and perpetuating hostility in Social Science. Institutional structures, resources, and proactive leadership in Natural Science contributed to inclusivity, while failed bias reporting and lack of intervention in Social Science perpetuated a hostile climate. The study highlights the influence of faculty agency and the impact of organizational factors on faculty diversity, offering insights for fostering equitable departmental climates.