Two field experiments examined how ethnic group cues and anxiety about the virus infection predict customer prejudice and associated behavioral responses for customers of four main categories of ethnic restaurants in Egypt during the onset of the COVID-19 pandemic. In Study 1 (n=576) ethnic prejudice was differentiated by restaurant categories. A sub-group analysis revealed that factual misjudgments played a notable role in influencing ethnic prejudice, particularly in conjunction with lower affect levels and heightened perceived health risks. Our findings indicate a lack of specific evidence regarding ethnic prejudice towards Chinese restaurants, but rather a tendency to unfavorably judge Asian (non-Chinese) restaurants. Study 2 (n=288), examined the influence of negative risk communication on the formation of ethnic prejudice towards Chinese restaurants. The results only provide weak support for the hypothesis that information stressing the connection between China and the coronavirus increased ethnic prejudice towards Chinese restaurants. Indirect effects attributed to increased perceived risks and heightened affective responses among customers with lower levels of prejudice contributed to this finding. Higher levels of actionable knowledge distance did not offset these prejudicial effects. Our results suggest that strategies that aim to reduce stigma among the general public during public health crises should be reconsidered