This research tests the self-esteem argument for multiculturalism: the idea that acceptance and recognition of cultural diversity is crucial for personal self-feelings because of its support for ethnic identity. Results from three studies using two different methodologies (correlational and experimental) provide support for this argument among ethnic minority and majority participants living in the Netherlands. The results of the first two studies show that multiculturalism is positively associated to self-esteem among ethnic minority (Studies 1 and 2) and majority group (Study 1) participants who identify strongly with their ethnic group. The third experimental questionnaire study shows that multiculturalism provides a favorable social context for positive self-esteem for both minority and majority group members who identify with and feel committed to their ethnic group. However, it is also a context in which low group identifiers appear to have relatively low self-esteem.