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The Canadian government often promotes multiculturalism, diversity, and the welcoming of refugees as part of Canadian national identity. Recently, the Canadian government surpassed its milestone of accepting 40,000 Afghan refugees since the 2021 Taliban takeover of Afghanistan. Yet Canada’s participation in the War on Terror in Afghanistan played a role in creating the current circumstances of Afghan refugees amid ongoing Islamophobic anxieties within the Canadian public sphere. The contradictions between ideals of diversity, openness, multiculturalism, and Islamophobic anxieties in Canadian politics and public opinion (re)shape and complicate what it means to be Afghan in Canada. Drawing on 40 semi-structured interviews with Afghans in Ontario, I illustrate the various layers of discrimination and multiple Orientalisms that Afghans in Canada experience, which are manifested at different levels of analysis (micro, meso, and macro), impacting their identity formation processes. I use the concept of the third space to illustrate how Afghans negotiate their identity and everyday spaces of diversity within a multicultural nation. I argue that diasporic Afghans in Canada reshape narratives of what it means to be Afghan, Canadian, and Afghan-Canadian within a racial hierarchy that promotes ideals of multiculturalism.