Because diversity is vital to many businesses, it is important to understand prospective racioethnic differences in employee engagement. Using survey data collected from a large (N = 5,537), diverse sample of retail employees, we found that more favorable appraisal reactions corresponded with more favorable psychological diversity climate perceptions; thus, higher levels of engagement. This indirect relationship was significantly stronger for ethnic minority employees (Blacks and Hispanics) than for White employees, indicating that members of traditionally disadvantaged groups respond differently to perceptions of appraisal systems. Finally, an exploratory assessment found that the hypothesized effects for racioethnicity do not generalize to sex, as the indirect effect of appraisal reactions on engagement was slightly, but not significantly stronger for women than for men.