The authors propose that the nature of prejudice differs across cultures. A model is introduced that proposes that the interpersonal perspective associated with individualist cultures (Westerners) leads to interpersonal prejudices, whereas the intergroup perspective associated with collectivist cultures (Easterners) leads to intergroup prejudices. These prejudices, in turn, are argued to impact on the outcomes of individuals working in intercultural teams. An organisational diversity climate of openness fostered by diversity oriented HRM and the combined use of individualist and collectivist HRM policies and practices is proposed to minimize the negative effects of such prejudices can be minimized.