Youths in care are among the most vulnerable youths in our society. All youths in care have experienced trauma and sometimes exhibit trauma-induced behaviours which are perceived by others as disruptive or dangerous. The police are frequently called, which begins a cycle of criminalization for many youths, with racialized youths overrepresented in this group. Using an intersectional theoretical framework, this article shows how discriminatory perceptions of race and mental health influence justice system actors’ decision-making, from arrest to bail. Drawing on data from qualitative interviews with twenty-five young adults (ages 18 to 24) who have had contact with the child welfare and criminal justice systems and ten practicing lawyers in Ontario, the analysis reveals race-based differences in justice system actors’ responses to mental illness. Discriminatory views function as a lens through which racialized and mentally ill youths leaving care are perceived as threats and met with more punitive responses.