Many historians agree that categories of human division underwent a drastic change due to European New World encounters. The shift from religious divisions to ones based on ethnicity and skin color gradually developed in early modern Europe. Hence, before natives became "red," and Europeans "white" a period existed where the differences between these cultures were utilized in a variety of means to prove similarity and difference. One element signifying difference during the early contact period was that of the beard. Hair as an identifier has a long history: through the middle ages, wildness was conveyed by hair and at times non-Christians were legally required to grow beards. Early in the sixteenth century the beard became a popular fad for white, Christian-European men, a change which some scholars have traced to European contact with beardless Amerindians. Within Europe, the beard came to represent more than otherness. A thick beard conveyed images of health, particularly sexual health; the beard came to represent virility and the beard helped to separate men from women and boys. In this paper I argue that the beard assumed a special significance within early English contacts in the Carolinas and Virginia. I examine the changing meanings of the beard and the English adoption of these meanings. I first examine the European background which helped provide the context for their first permanent colonial settlements in the New World. I next delve into travel accounts, ethnographies and artistic portrayals of the Natives in these colonies to examine how and when both sides evoked facial hair as a signifier of difference. This examination will help reveal English views of Natives during a time when their views regarding the Natives' character could affect the success of English colonial ventures. Finally, I examine why the beard failed as a sign of difference between the region's Amerindians and the English. This failure led to the adoption of other means of distinction specifically that of skin color. Hence the beard served as a first stepping stone towards what would become a fully conceptualized racial theory.