Increased communication between people of different cultures has led to the development of the field of intercultural studies. The field is interdisciplinary in nature, as it draws from theories by scholars in other fields, one of which is social psychology. This dissertation examines aspects of social psychology that are particularly relevant to intercultural communication, as a greater understanding of certain social psychological concepts may increase the effectiveness of intercultural interaction. Central to the argument is the notion of the group, as group inclusion provides norms, roles, and social identities to its members. The relationship between group membership and identity is examined in detail, especially with respect to individuals’ sense of identity and how they relate to members of their in-groups and out-groups. The social comparison theory is an integral part of identity construal because when forming a social identity, people need to compare themselves to others who are not part of their in-groups. How people view members of their out-groups (and compare themselves against them) is related to stereotypes, prejudice, and discrimination. Group identity and the use of stereotypes are related to self-esteem, as there is a tendency to view in-group members as inherently superior to out-group members. While this dissertation focuses on social psychological factors that are important to intercultural communication, the psychological aspects of cross-cultural adaptation are briefly discussed, as they also have the potential to influence intercultural interaction. Contexts in which intercultural communication is most likely to take place are examined, focusing on the social psychological factors that underlie such communication. The role of the cultural marginal is also discussed, as people who are socialized into the periphery of two or more cultures develop a unique cultural perspective that, in recent years, has become a socially desirable view.