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The concept of privilege has long been used by social scientists to describe the individual-level manifestation of the benefits of unequal social systems. However, the term “privilege” has a cultural life of its own that may differ markedly from academic conceptualizations. How do members of the public perceive “privilege” and their relationship to it? Despite sustained scholarly attention to public beliefs and attitudes about inequality in the US, we know little about how Americans contend with the cultural underpinnings of privilege. Drawing on over 200 interviews from a unique pairing of samples—a diverse cross-section of Americans and a sample of intersectionally privileged professionals—we ask, (1) how do individuals situate themselves within abstract hierarchies of privilege? (2) How do they negotiate the moral implications of being (or presumed by others to be) privileged? (3) What strategies do they use to mitigate the specter of unearned advantage that accompanies privilege? We argue that privilege is principally meaningful to Americans in its invocation of a moral hierarchy, where moral virtue is inversely proportional to benefitting from unearned advantage. Specifically, we argue that privilege acts as a cultural schema that implicates individuals in a moral hierarchy of deservingness of (un)earned advantages in resources, opportunities, and respect. The perceived immorality of this “unearned” dimension of privilege acts as a metaphorical specter that threatens respondents’ sense of moral personhood. We find that respondents employed three rhetorical tactics to distance themselves from the moral risks of unearned privilege and express defensiveness when they fear it will be attached to them. Indeed, many conceptualized privilege as applying only to advantages that are unearned. Broadly, this study helps scholars understand why the label “privileged” is so contentious and informs development of better interventions to expand public awareness of social inequality.