The UAE has the largest migration rate in the world; its major workforce originates from numerous countries, including India, Pakistan, the Philippines, Australia, and the United States of America. While this workforce diversity contributes varied backgrounds and languages to the workplace, diversity can also present major challenges for management. Workforce diversity, tension, and conflict can result in the creation of invisible barriers, a lack in communication or coordination, and a lack of recognition of positive employee behavior. Yet, while organizations may suffer from internal conflict, the tension that accompanies diversity can also result in positive outcomes, like an increased competitive spirit, enhanced productivity, and gains in creativity of employees. This chapter focuses on assessing the benefits and liabilities of workforce diversity as manifest in the unique demographic context of the UAE. Qualitative methods employing interviews were used to investigate research questions about diversity. Interviews with 41 respondents were collected from 32 officials working in the UAE companies. The authors supplemented these interviews with quantitative methods, employing a questionnaire of 213 employees in selected local organizations. The research concludes that conflict, rather than positive outcomes, arises when workforce diversity leads to a combination of the following: a difference of opinion, a lack of coordination and communication, and a lack of properly defined responsibilities.