The Cronulla riots signalled the existence of a banal everyday form of racism operating in Australia that works to construct Muslims as ‘other’. In this article, racism is explored as ideology, (re)produced through, and reflected in social practices and processes, such as language and communication. Media representations are considered, a site where dominant social narratives manifest and where racism happens. Using Foucauldian discourse analysis, several strategies employed to construct ‘in- groups’ and ‘out groups’, following the riots, were revealed in newspaper discourse, and dominant understandings of Muslims, multiculturalism and racism became apparent. Discourses identified that problematise Muslims, included the construction of the ‘inassimilable, misogynist and criminal other’. Discourses that effectively legitimate deny and justify this othering, thereby maintain Australia and Australians self image as a fair, just and tolerant society, included the construction of ‘the good nation; Howard’s diverse country’. Findings reflect the importance of understanding everyday forms of racism, operating in and through social narratives, which function to construct particular groups in particular ways. This research offers important lessons on the importance of examining taken for granted ‘text and talk’, as a site of racism.