Why are some multi-ethnic communities able to achieve mutually beneficial collective action while others remain trapped in social dilemmas? Across a wide variety of settings, scholars have demonstrated that ethnic diversity tends to undermine the local provision of public goods. However, recent empirical studies have found exceptions to this rule. In some diverse communities the hindrances to collective action are less challenging, as individuals of different ethnicities are willing to work together to manage public resources or supply supplementary public goods. This dissertation addresses when and why we observe local goods provision in multi-ethnic localities across Africa, identifying inter-ethnic trust as a causal mechanism enabling individuals to contribute to their community's well-being despite its diversity. Building on constructivist scholarship, this dissertation explores the micro-foundational link between identity and trust as well as the institutional and demographic factors that shape patterns of inter-ethnic trust in diverse communities, ultimately linking these factors to individual participation in public goods provision. I argue that multi-ethnic communities will be able to resolve their collective action problems and provide public goods locally in those areas where the saliency of ethnicity has been tempered by contextual variables and inter-ethnic trust has been given space to germinate. To test my hypotheses, I use public opinion surveys from the Afrobarometer project, country-level measures of ethnic fragmentation, and original data collected in ethnically heterogeneous neighborhoods across Cape Town, South Africa to conduct statistical, large-n analyses of identity, trust, and participation across Africa as well as an in-depth case study of local goods provision in Cape Town. The dissertation reveals two main findings. First, the degree to which individuals trust non-coethnics depends on the strength of their ethnic identification. Secondly, in contexts of both ethnic homogeneity and heterogeneity, individuals who are trusting of non-coethnics are more likely to contribute to goods provision. My results bolster constructivist scholarship on the context-dependent effects of ethnicity and highlight the conditions under which collective action can be sustained in diverse societies. The dissertation offers cross-disciplinary implications for scholarship and policy in the development field.