ObjectivesBlacks and Hispanics are at increased risk for dementia, even after socioeconomic and vascular factors are taken into account. This study tests a comprehensive model of psychosocial pathways leading to differences in longitudinal cognitive outcomes among older blacks and Hispanics, compared to non-Hispanic whites.MethodsUsing data from 10,173 participants aged 65 and older in the Health and Retirement Study, structural equation models tested associations among race/ethnicity, perceived discrimination, depressive symptoms, external locus of control, and 6-year memory trajectories, controlling for age, sex, educational attainment, income, wealth, and chronic diseases.ResultsGreater perceived discrimination among blacks was associated with lower initial memory level via depressive symptoms and external locus of control, and with faster memory decline directly. Greater depressive symptoms and external locus of control among Hispanics were each independently associated with lower initial memory, but there were no pathways from Hispanic ethnicity to memory decline.DiscussionDepression and external locus of control partially mediate racial/ethnic differences in memory trajectories. Perceived discrimination is a major driver of these psychosocial pathways for blacks, but not Hispanics. These results can inform the development of policies and interventions to reduce cognitive morbidity among racially/ethnically diverse older adults.