Based on self-categorization theory (SCT; Turner, Hogg, Oakes, Reicher, & Wetherell, 1987), this study examined the extent to which 7- and 10-year-old children's perceptions of similarity to, and positivity towards, their in-group would be increased by factors predicted to enhance the salience of in-group–out-group categorizations. In a minimal group study, participants met the in-group before or after the out-group (group timing), the out-group had the same or different ethnicity as the in-group (out-group ethnicity), and there was or was not to be a competition between the in-group and the out-group (intergroup competition). Ratings of the in-group similarity were influenced by the out-group ethnicity, but not by group timing or intergroup competition. Consistent with SCT, participants rated themselves as more similar to the in-group when the out-group had different vs. the same ethnicity. SCT's predictions concerning in-group positivity were not confirmed. Instead, participants rated the in-group more positively than the out-group and the in-group was rated more positively, when participants met the in-group before rather than after the out-group. Older compared with younger participants were also more prepared to change groups when the out-group had different ethnicity. The implications for SCT are discussed.