AbstractA superordinate identity that emphasizes the shared bond between people of different groups can have beneficial outcomes according to the theoretical argument of the common ingroup identity model. Unlike previous research that focuses on a single superordinate identity, we simultaneously study two superordinate identities: local identity (identification with the neighborhood) and national identity (identification with the country of residence). Our study is set in two ethnically heterogenous and low‐income neighborhoods in Sweden. Based on four waves of panel survey data, we find that both types of superordinate identities are associated with increases in interpersonal and institutional trust. The identities have distinct consequences, however. Local identity is related to local trust and national identity to national trust. These results are based on within‐individual variation. Since high trust generally has a range of positive consequences, our results point to an approach at improving communities that are often in much need of it. We observe low correlation between the two superordinate identities and high convergent and discriminant validity of the concepts. Our results may be relevant to similar neighborhoods that exist across Europe.