Why do states discriminate? Recent work emphasizes that exclusion is a direct outcome of competition and negotiation over authority. I offer an additional explanation: discrimination is brought on indirectly, where questions of loyalty and trust, brought up through civic conflict and contested authority, undermine the tenuous position of groups already marked as different. I study this mechanism at a key moment in political development, as fifteenth-century European polities experimented with representative institutions and constituents revolted against perceived untrustworthiness and misrepresentation. Using a sample of German cities where revolts did and did not occur, I give statistical and narrative evidence of how class-based conflict to “right-size” government spilled over into the persecution of Jews. Urban revolt shaped democratic development at the same time as spurring ethnoracial exclusion.