ABSTRACT Minority members are often targeted by online hate speech. In this article, we advance the literature by conceptualizing online hate speech as a social identity threat, whose consequences can adversely affect intergroup relations at large. Within two experiments, we examine the effects of homophobic (Study 1, N = 225) and racist (Study 2, N = 194) hate speech on target minority members’ attitudes toward the majority group and intentions to avoid it. In addition, we test the potential mitigating role of counter-speech presence and source (minority vs. majority member). Drawing from theoretical accounts of social identity and perceived opinion climate, we also shed light on novel underlying mechanisms that explain the effect of online hate speech on intergroup relations: perceived identity threat (PIT) and perceived negative representation (PNR). Across both studies, more severe hate speech resulted in greater PIT and PNR, which was related to more hostile attitudes toward the majority group and/or intentions to avoid majority members. Counter-speech was largely ineffective in alleviating these negative outcomes. However, Study 2 revealed that counter-speech from a majority member could mitigate PIT, but only for less severe forms of hate speech. We discuss theoretical and practical implications for research in media psychology.