Participants were instructed to organize information about group members either by distinguishing stereotype-consistent from stereotype-inconsistent individuals (subtyping instructions), by dividing the individuals into multiple groups on the basis of similarities and differences (subgrouping instructions), or with no explicit organizing instructions. Participants given the subtyping instructions showed greater perceived stereotypicality and homogeneity and perceived a greater difference in how typical the confirming versus disconfirming group members were, relative to subgroup participants. Study 2 demonstrated natural variation among participants in the perceived atypicality of the disconfirming relative to confirming individuals when learning about a gay activist group. Atypicality predicted perceptions of this group, even when prejudice and strength of stereotyping toward gays as a whole were statistically controlled.