Three experiments investigated whether the repeated-letter inferiority effect (RLIE) and repetition blindness (RB) are identical phenomena or not and how the RLIE can be reconciled with the flanker compatibility effect (FCE). Participants reported a masked target and ignored an unmasked distractor. We manipulated the type of distractor (identical, alternative target, or neutral), the order of presenting distractor and target, and the predictability of target location. When distractors preceded the targets, distractors identical to the target always caused deficits in target processing (i.e., RB). With simultaneous presentation, identical distractors caused deficits (i.e., an RLIE) for unpredictable target locations only. Yet the RLIE was significantly smaller than RB. This result suggests that simultaneously presented stimuli are identified serially, in random order, if target position is unpredictable. As a result, RB arises only in the 50% of all trials with identical distractors in which the distractor is identified before the target. With simultaneous presentation and predictable target location, however, parallel processing of targets and distractors was possible that gave rise to an FCE in recognition accuracy. Analyses of false alarm rates revealed no evidence of significant response biases.