The Miskitu, a group indigenous to the Caribbean Coast of Central America, have long been recognized for their racial diversity. In the mid-seventeenth century, a ship of African slaves wrecked on the Mosquito Coast and subsequently intermarried with the Miskitu population. Since then, there have been two groups of Miskitu: the “pure” indios and the racially mixed sambos. This article argues against this neat divide. Race during the colonial period was not fixed and could be influenced by a number of factors that included not only one’s ancestry but also their behavior. When Spanish writers assigned a racial category to the Miskitu, the context of the encounter often shaped perceived racial origin. When Miskitu-Spanish relations were hostile, Spaniards more often chose the racial label sambo. During times of peace, indio was more common, and mestizo was sometimes used to refer to Miskitu rulers. By focusing on the complexity and malleability of colonial racial rhetoric, this article argues that Spanish officials strategically selected racial labels for the Miskitu depending on the colonial policy they were trying to promote.