Introduction: Claude Steele's stereotype threat hypothesis proposed that negative group stereotypes increase individual anxiety levels, hurting performance. However, the role of anxiety in stereotype threat has not been fully explored. This study examined the hypothesis that experimental manipulation of stereotype threat would influence real-time measures of physiological arousal and cognitive efficiency in girls and boys taking mathematics tests. Method: Participants were students at a large public university in the USA. Girls and boys were randomly assigned to either high or low stereotype threat conditions, and following an adaptation period, were presented a challenging mathematics task while physiological measures were recorded. Cognitive processing time was recorded for each test item. Results: Results showed significant physiological reactance (skin conductance, skin temperature, blood pressure) as a function of a stereotype threat manipulation. Results also showed significant differences in cognitive efficiency as a function of stereotype threat. Conclusion: These findings are consistent with the argument that stereotype threat manipulations either increase or decrease situationally-specific anxiety. These findings hold significant implications for high-stakes academic testing and other situations. (Contains 3 figures.)