<![CDATA[Religious diversity challenges schools to strengthen religious identity while cultivating openness and constructive participation in plural societies. This study examines how Islamic identity is constructed and negotiated in madrasahs within Hindu-majority communities in Bali and how these processes inform a pedagogy of coexistence supporting religious moderation. A qualitative multiple-case study involved four Islamic secondary schools in Tabanan and 40 participants, including principals, curriculum vice-principals, Islamic Religious Education teachers, and students. Curriculum documents and semi-structured interviews were analysed through reflexive thematic analysis, within-case analysis, and cross-case comparison. Findings indicate that religious anchoring coexisted with contextual social openness. The madrasahs maintained relatively firm theological boundaries while negotiating social and cultural participation through selective cultural incorporation, structured encounters, reflective dialogue, and shared action. Participants’ accounts suggested connections between these practices and empathy, perspective-taking, cultural understanding, critical reasoning, peaceful conflict management, and digital literacy. The study proposes an interpretative model linking religious anchoring, identity security, boundary awareness, contextual negotiation, encounters, reflection, and shared action with coexistence competence. It contributes to Islamic education and educational psychology by explaining how secure religious identity may support reflective and constructive interreligious relationships, while recognising that pedagogical outcomes depend on contextual conditions and the quality of sustained educational mediation.]]>
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