DescriptionRecent research on collaborative learning demonstrates the importance of social aspects of groupwork for learning (e.g., Barron, 2003). Yet, a developmental lens on early adolescents’ identity work during collaboration is absent. From a developmental perspective, both competence and contextualized peer relationships are critical for early adolescents’ identities in middle school (Roeser & Eccles, 2000). Marginality situates identity within the context of development by emphasizing how students handle exclusion in groupwork. The present studies employed sociocultural and activity theoretical lenses to examine the unfolding of marginal identities in 7th grade classrooms at ethnically-diverse middle schools during three inquiry science units. Four questions were addressed: (1) how do group members negotiate competence during collaboration?, (2) how do marginal group members exercise agency?, (3) how do the forms of agency exercised by marginal group members relate to identity trajectories over a semester?, and (4) how does the structure of group activity systems contribute to the formation of marginal identities? Qualitative methods were used to analyze videotaped observations of groupwork and student interviews for Studies 1 and 2. Study 3 was a case study of outbound trajectories of marginality and activity system structures. Results of Study 1 indicate that group members negotiated competence in response to other-regulation. Study 2 produced a framework for marginality and agency; findings indicated that off-task activity was frequently used as a space to resist marginality and trajectories were best described by differences in number of alliances and flexibility of those alliances. Study 3 findings revealed that marginal identities were associated with contradictions within rules that impacted the division of labor; division of labor was employed to exclude group members or invoke an intellectual/manual division of labor. Overall, results suggest that students need ways to access on-task activity without threats to competence. Further, sub-processes were identified that were involved in exerting agency even as the group negotiates exclusion and marginality. Findings suggest that professional development should focus on teachers supporting positive, central identities in groupwork and fostering group norms conducive to a psychologically safe climate. Students should also receive training on how to reduce their groups’ focus on relative competence.