<p>Discriminatory teacher beliefs and behaviors, as reflected in a discriminatory climate, are negatively related to student adjustment, but little is known about the classroom processes contributing to this relationship. This study investigated the role of teaching quality as a mechanism behind the associations between a discriminatory climate at school and students’ school adjustment. The study used PISA data collected in Germany in 2018 (<i>N</i> = 2947; <i>M</i>_age = 15.47 years, <i>SD</i> = 0.65; 48.4% girls) and included ninth graders (1) from ethnically minoritized groups that are highly stigmatized (i.e., with heritage from Turkey, the SWANA region, sub-Saharan Africa, and Kurdish areas; <i>n</i> = 198), (2) from other ethnically minoritized groups (<i>n</i> = 445), and (3) from the ethnic majority (<i>n</i> = 2304). The students in Group 1 reported a more discriminatory climate at school than the other student groups did. Multilevel analyses revealed that a discriminatory climate was negatively related to all three indicators of school adjustment (i.e., reading comprehension, reading motivation, and school belonging). Adolescents who perceived a stronger discriminatory climate experienced lessons as less structured and more disruptive, highlighting the mediating role of classroom management in the relationship between discriminatory climate and adolescents’ school adjustment. Thus, a discriminatory climate at school hampers adolescents’ educational outcomes not only directly, but also via teachers’ instructional behavior in class.</p>