This chapter reviews individual and contextual processes that explain why prejudice exists in diverse societies and what processes and strategies can contribute to its reduction. The first half of the chapter discusses origins and definitions of intergroup prejudice, along with ideological and structural factors that support the endurance of intergroup prejudice, such as authoritarianism, social dominance orientation, and patterns of social segregation. The second half discusses strategies and processes involved in prejudice reduction, with a particular emphasis on those derived from intergroup contact theory, including situational conditions, social categorization, cross-group friendships, and motivational processes of individuals such as anxiety reduction and empathy. Taken together, this chapter highlights that prejudice and its diminution are best understood when individual and contextual factors, and their interaction, are jointly employed to illuminate negative and positive intergroup relations between groups.