Among the strategies dominant groups employ to sustain hierarchy, ideology – defined here as systems of rhetoric, ideas, and associated symbols – has received less attention from political scientists than other tools used to maintain dominance. Here I propose that when elites need to tolerate human capital advancements among subordinate out-groups, they deploy ideology as a particularly well-suited tool for containing threats that may arise from the out-group and poor members of their in-group and thereby safeguarding elites’ status. I examine the emergence of the United Daughters of the Confederacy (UDC), which dedicated extensive resources to propagating the “Lost Cause.” This ideology aimed at legitimating white dominance, psychologically compensating poor whites for status loss, and sustaining prejudice against Blacks – through various different channels, including educational content in Southern white public schools between 1900 and 1920. Using original quantitative data on the formation of UDC chapters at the county level, I show that UDC chapters emerged in response to local advancements in Black human capital and in-group inequality. Qualitative evidence demonstrates how elites thought about this dilemma and the strategic purpose of their ideological mobilization.