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While faith-based schooling plays a prominent role in numerous countries, empirical research on non-state religious schools operating in a market context remains limited and fragmentary. This study addresses this gap by unpacking the responses of religious private schools to competitive pressures, focusing on how they negotiate their religious identity. With this objective, the paper presents a case study of Catholic school networks in Spain. We identify three different approaches to religious education and identity developed by these providers – confessional, culture-centric and value-centric. The triggering factors and enabling conditions behind these approaches are examined in detail. The study discusses the relevance of these findings for ongoing debates around the public funding of faith-based schools, foregrounding tensions relative to pluralism and equity.