At some point in the near future, the Supreme Court will weigh in on the permissible scope of affirmative action to increase workplace diversity. Undoubtedly, many scholars will argue that if affirmative action is good for colleges and universities, it is good for workplaces as well. One cannot assess whether this “transplant” argument is right without understanding the ways in which diversity initiatives at colleges and universities interact with diversity initiatives at work. The university and the workplace are not separate and distinct institutional settings in which diversity is or is not achieved. They are part of an interconnected system. We call this system the “Diversity Loop,” and it is constituted by three central features: a supply effect (the diversity the university “supplies” to the labor market), a reiteration effect (the extent to which that diversity can be “reiterated” into the workplace), and a demand effect (the influence the employer’s “demand” for particular kinds of employees has on the university’s admissions criteria). The existence of this Diversity Loop is relevant to the normative question of whether it is desirable to promote affirmative action in both the workplace and the university settings and to the doctrinal question of whether the legality of affirmative action in the context of the workplace should be coextensive with the legality of affirmative action in the context of the university.