In this essay, Bruce Maxwell, David Waddington, Kevin McDonough, Andree-Anne Cormier, and Marina Schwimmer compare two competing approaches to social integration policy, Multiculturalism and Interculturalism, from the perspective of the issue of the state funding and regulation of conservative religious schools. After identifying the key differences between Interculturalism and Multiculturalism, as well as their many similarities, the authors present an explanatory analysis of this intractable policy challenge. Conservative religious schooling, they argue, tests a conceptual tension inherent in Multiculturalism between respect for group diversity and autonomy, on the one hand, and the ideal of intercultural citizenship, on the other. Taking as a case study Quebec's education system and, in particular, recent curricular innovations aimed at helping young people acquire the capabilities of intercultural citizenship, the authors illustrate how Interculturalism signals a compelling way forward in the effort to overcome the political dilemma of conservative religious schooling. (Contains 51 footnotes.)