Australia, like the United States (US) and the United Kingdom (UK), continues to experience a mismatch between the cultural backgrounds and socio-economic class of teachers and those of the students they work with. This article reports on a study that explored how a group of Australian teacher-education students understand their own ethnic and socio-economic class identities and how they work with students of ethnic and class backgrounds different from their own. Analysis of data from interviews and focus groups with the student-teachers is presented to highlight how they make sense of difference and how they take up the challenges of teaching for diversity. The paper raises issues and concerns regarding how diversity and difference might be addressed in teacher education.