As critical language pedagogies are being implemented in heritage language (HL) settings, there is an increasing need to examine the impact of critical approaches in Spanish HL speakers. The present study examines how the development of HL learners’ critical language awareness (CLA) influences ethnic identity formation in a university-level course that adopts a critical approach to HL instruction. As part of the curricular content, a CLA instructional intervention, consisting of a 4-week unit (10 h), was implemented. First, to measure ethnic identity, at the beginning (pre) and at the end of the semester (post), students completed the Ethnic Identity Scale (EIS) and provided comments with their answers. Additionally, in order to examine CLA development before and after the intervention, participants completed an existing questionnaire, which addresses topics such as language variation, language ideologies, and bilingualism. Overall, the results show that students’ CLA levels increased from “somewhat high” to “high”. Furthermore, participants reported different ethnic–racial identity statuses, which moved toward ethnic identity achievement. Higher CLA levels were associated with an achieved positive status. These findings can contribute to a better understanding of the link between students’ CLA and ethnic identity in HL educational settings, where a critical language pedagogy is applied.