Since the advent of democracy in South Africa in1994, much effort has been expended on overcoming the institutionalised racism that characterised apartheid. The transfor mation of higher education, particularly with regard to the merging and incorporation of institutions, is such an example. This article is an analysis of discourses on race emerging in the talk of students and staff during the incorporation of a historically white satellite campus (Rhodes University East London) into a historically black university (Uni versity of Fort Hare). The argument, which relies on Essed's notion of everyday racism, infused with insights from discursive psychology, is that higher education institutions are racialised through the intricate interweaving of macro-level processes and discourses that recur in everyday talk and practices. In their talk, the participants in the study per sistently assigned racialised identities to the institutions (Rhodes is white and Fort Hare is black) and invoked a 'white excellence/black failure' discourse. 'White excellence' folds in on, and is reproduced by, the desirable, modern, urban space and an appeal to Euro-American standards. Institutions and individuals are positioned as being able to overcome 'black failure' by moving into white space and through intense personal labour.One of the perpetual conundrums facing social scienctists is how to understand the mundane, everyday practices of individuals in relation to structural or macro-level issues. This has variously been referred to as the individual-society divide (Hen-