Although recent scholarly reviews have synthesized understandings of intercultural competence, the processes underpinning how individuals acquire and evaluate their intercultural competence, and where it resides, invite further investigation. This study aims to make a distinctive contribution by exposing those processes. Thirty-five student researchers (the participants in this study), guided by an ethnographic approach, engaged socially over a six-week period with a previously unknown Cultural Other. The PEER model (developed by the two researchers) guided student researchers through the interconnected and interdependent phases of Preparing, Engaging, Evaluating, and Reflecting upon their competence within these intercultural encounters. The findings indicate that developing intercultural competence encompasses processes of acknowledging reluctance and fear, foregrounding and questioning stereotypes, monitoring feelings and emotions, working through confusion, and grappling with complexity. The study therefore highlights the value of the PEER model in facilitating continued relationship building with a Cultural Other as a means of developing and evaluating intercultural competence; it also makes a clear contribution to this field by demonstrating the importance of the intercultural encounter as the place where individuals can shift their focus away from an external evaluation of the Other to an inward contemplation of their own intercultural competence. The study also provides a new methodological resource, the PEER model, for developing and evaluating intercultural competence.