Ethnic or racial discrimination towards children and adolescents at schools is of concern in many contexts around the world because it is associated with diverse psychosocial, behavioural, emotional, and identity problems. The purpose of this study was to identify the types of ethnic discrimination experienced by indigenous Mapuche adolescents in schools in Chile. The study was qualitative in nature and two techniques were used: semi-structured interviews and focus groups involving an ‘indicative’ sample of 80 participants (30 students and 50 teachers) from three urban high schools in the Araucanía Region, Chile. Three modes of ethnic discrimination were identified: verbal, behavioural-attitudinal and institutional. A ‘non virtuous cycle’ of discrimination is suggested. It originates with teachers’ prejudiced attitudes that lead to attributions of deficit among Mapuche adolescents. When these attributions are activated, they lead to a diminished sense of competence, avoidance and segregation among Mapuche students who then withdraw from active participation in learning, which perpetuates and confirms teachers’ prejudice and attributions. Recommendations for the educational system, schools, and teachers are discussed to diminish the manifestation of ethnic discrimination at schools and its negative consequences for indigenous adolescent population.