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Recent research has suggested that bullying behaviour may be understood as a group process, where those involved act in ways predicted by social identity theory (Ojala & Nesdale, 2004). One relevant phenomenon is the black sheep effect, whereby individuals evaluate deviant members of their in-group more negatively than that of an out-group. To examine this process, a study was conducted (N = 60) in which 10- and 11-year-old children were randomly assigned to a high-status, peripheral or irrelevant group. They were then read a scenario in which a member of the high-status group bullied a person outside the group and was supported by other high-status group members. It was found that assigned group membership affected judgements of the acceptability of the bullying behaviour and the likeability of both (a) the high-status group and (b) the high-status group member. Specifically, evidence of a black sheep effect meant that high-status group members showed less liking for the high-status group member than for the high-status group, and believed that this member deserved greater punishment than the high-status group as a whole. Peripheral group members differentiated between the high-status group member and the high-status group in terms of liking but not punishment, while members of the irrelevant group did not make a distinction on either measure. Implications for the conceptualization of bullying are discussed.