Racial and gender differences in the effects of discrimination on health are well-established. The evidence has derived largely from studies of older adults, with less attention paid to younger adults. The current study takes an intersectional approach to address this gap. Using nationally representative, longitudinal data from the 2017 and 2019 Panel Study of Income Dynamics Transitioning to Adulthood Supplement (PSID-TAS), we assess the effects of everyday discrimination on psychological distress among Black and White young adults aged 18–28 (n = 3894). We examine cumulative discrimination and individual items of the cumulative measure based on the Everyday Discrimination Scale. The analysis reveals that perceived discrimination is positively associated with psychological distress for each race-gender group. However, the magnitude of the association varied by group and dimension of discrimination. Black men and women reported more frequent experiences of each type of discrimination than their White counterparts. The positive association between discrimination and distress, however, was lower for Black men and women relative to White men— suggesting that White men may be more sensitive to and/or less resilient against the effects of perceived discrimination. In contrast, associations for White women did not differ significantly from those of White men. Our findings demonstrate that the health-harming effects of discrimination on psychological distress begin early in the life course and suggest that resilience-based coping mechanisms found in older samples of Black adults may also exist for younger adults.