By the time children are in the early grades of school, much of their activity takes place within social groups. They eagerly join some groups, but avoid - or are excluded from - others. Based on sex as a master status, for example, girls and boys often form distinct play groups with patterns of behaviour culturally defined as feminine and masculine.
On the basis of sex, employment, family ties, personal tastes, or some other category, people often identify others positively with one social group while opposing other groups. Across the United States, for example, many high school students wear jackets with the name of their school on the back and place school decals on their car windows to symbolize their membership in the school as a social group. Students who attend another school may be the subject of derision simply because they are members of a competing group.
This illustrates the general process of forming in-groups and out-groups. An in-group is a social group with which people identify and toward which they feel a sense of loyalty. An in-group exists in relation to an out-group, which is a social group with which people do not identify and toward which they feel a sense of competition or opposition. Defining social groups this way is commonplace. A sports team is an in-group to its members and an out-group to members of other teams. The Democrats in a certain community may see themselves as an in-group in relation to Republicans. In a broader sense, Americans share some sense of being an in-group in relation to Russian citizens or other nationalities. All in-groups and out-groups are created by the process of believing that “we” have valued characteristics that “they” do not.
This process serves to sharpen the boundaries among social groups, giving people a clearer sense of their location in a world of many social groups. It also heightens awareness of the distinctive characteristics of various social groups, though not always in an accurate way. Research has shown, however, that the members of in-groups hold unrealistically positive views of themselves and unfairly negative views of various out-groups. Ethnocentrism, for example, is the result of overvaluing one's own way of life, while simultaneously devaluing other cultures as out-groups.