Focusing on the local level where change is supported or resisted, an ethnographic study examined the response of a town in upstate New York to demands for broadening the curriculum within the context of altering the educational environment to better serve the needs of minority youth. The controversy began when a school board member refused to apologize to the Latino community for what many felt were disparaging public comments about Latin Americans and Latinos. Data on the conflict in the larger community included: a public forum in which community members were given the opportunity to present their views on the issue; data from news articles and letters to the editor in the local paper; community radio talk shows; discussions with community members; and observations of public events. Examination of the public discourse suggests sharply differing constructions of group identity and explanations for school failure between minority and senior citizen spokespersons. Analysis of the public discourse provided the framework for an examination of student and teacher responses observed formally and informally during the time that the school district began to respond to minority spokespersons' demands for educational change. Several key themes emerged in faculty discourse: (1) declining student/parent responsibility; (2) teachers as scapegoats; and (3) colorblindness. Findings suggest that the drive to reform the school curriculum to acknowledge cultural diversity challenges popular assumptions and comes up against obstacles both within the schools and within local bases of power, such as school boards. (Three figures representing conceptual frameworks and 22 footnotes are included; 38 references are attached.) (RS)