Despite compelling arguments for the dissemination of evidence-based treatments (EBTs), questions regarding their relevance to ethnically diverse populations remain. This review summarizes what is known about psychotherapy effects with ethnic minorities, with a particular focus on the role of cultural competence when implementing EBTs. Specifically, we address three questions: (a) does psychotherapy work with ethnic minorities, (b) do psychotherapy effects differ by ethnicity, and (c) does cultural tailoring enhance treatment effects? The evidence suggests that psychotherapy is generally effective with ethnic minorities, and treatment effects are fairly robust across cultural groups and problem areas. However, evidence for cultural competence is mixed. Ethnic minority-focused treatments frequently incorporate culturally tailored strategies, and these tailored treatments are mostly efficacious; yet support for cultural competence as a useful supplement to standard treatment remains equivocal at best. We also discuss research limitations, areas for future research, and clinical implications.