Recent laboratory and field experiments suggest that women are less effective than men in a competitive environment. I examine how teachers’ performance is affected by a competitive environment and its gender mix. Teachers participated in a tournament that provided cash bonuses based on test performance of their classes. I find no evidence of gender differences in performance under competition in any gender mix environment, or in teachers’ knowledge of the programme and in effort and teaching methods. Women, however, were more pessimistic about the effectiveness of teachers’ performance pay and more realistic than men about their likelihood of winning bonuses.