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In this paper, I present the findings of a 2-year mixed-methods study that used Social Equity Theory to examine how teachers’ beliefs (N = 36) differentially influence students’ (N = 568) scholastic competence, as well as perceived discrimination and ethnic identity. In the analyses, I found that when teachers were more likely to produce signal influences, students had lower levels of scholastic competence in mathematics and reading. Interviews with teachers reveal some of the deficit views teachers can hold, even when they believe they have high expectations of all students. Indeed, responses by teachers who were more likely to produce signal influences typically blamed parents and/or the students for lower achievement. The response exemplifies the erroneous belief that student motivation is something that can be willed by the student, without any consideration of the research that has helped us understand the instrumental role of the classroom environment in increasing motivation. In contrast, typical responses of teachers who were less likely to produce signal influences, when asked what they believe would increase achievement for Latino youth, included comments such as: “We need a curriculum that understands our students’ culture. Students are often not stimulated in school because teachers may not know a student's background or interests and fail to incorporate those into lessons.” Collectively, these findings suggest that SET, like other theories that consider the salient role of culture, race, and ethnicity, are needed in the study of student motivation.