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In this paper, I ask how school context matters for the salience of racial stereotypes and biased perceptions by teachers. I use a factorial vignette survey to experimentally test for racial and gender bias in teachers’ perceptions of students’ skills and behaviors, relying on a sample of teacher-respondents from schools of varying racial compositions. I find that teachers’ perceptions of student skills and behaviors largely align with stereotypes in the context of racial distinctiveness; boys of color are seen as more behaviorally problematic, White boys are seen as having higher academic competence, and White girls are seen as compliant in schools where they are in the racial minority. In a notable exception to this pattern, girls of color appear to be perceived most behaviorally problematic in schools with more peers of color, aligning with research on the policing of Black girls’ behavior. This has implications for understanding racial inequality in schools, and also for understanding the mechanisms of racial bias more broadly.