This article reports a case study about the process experienced by Japanese International students (JIs) in a suburban high school. The study examined the relation between schooling, multiculturalism and cultural identity. The research explored cultural identity as the outcome of contest: an ideological struggle over values, practices and cultural identity. The major findings of the study were that JIs negotiated new cultural identities in the process of facing difficulties of language, cultural understanding and racism as barriers. In the light of these difficulties three recommendations were made to educational policy makers. This research offers schools and educational policy makers ways to meet better the educational and cultural needs of students in the International Student Program (ISP). Also it contributes to a greater understanding of the contested relation between schooling, multiculturalism and cultural identity in contemporary Australian society. (Contains 3 figures.)