This study uses student panel data to examine the association between algebra placement and student motivation for mathematics. Changes in achievement goals, expectancy, and task value for students in eighth-grade algebra are compared with those of peers placed in lower-level mathematics courses (N = 3,306). In our sample, students placed in algebra reported an increase in performance-avoidance goals as well as decreases in academic self-efficacy and task value. These relations were attenuated for students who had high mathematics achievement prior to algebra placement. Whereas all students reported an overall decline in performance-approach goals over the course of eighth grade, previously high-achieving students reported an increase in these goals. Lastly, previously high-achieving students reported an increase in mastery goals. These findings suggest that while previously high-achieving students may benefit motivationally from eighth-grade algebra placement, placing previously average- and low-performing students in algebra can potentially undermine their motivation for mathematics.