Abstract: Although the Japanese government gave up its discourse on racial homogeneity to actively promote multiculturalism featuring Ainu cultural heritage, the organizing committee dropped the proposed Ainu performance in the 2020 Tokyo Olympics opening ceremony. This paper examines how the politics of (not) recognizing the Ainu assist in the production of the Japanese settler nation and the Ainu community’s strategies to survive within this context. I argue that the state needs Ainu representations to market itself as a liberal multicultural nation that respects human rights in the global society. However, it faces a dilemma when Indigenous recognition unsettles the legitimacy of settler occupation and exposes the violent colonial heritage of the nation. The Ainu community strategically utilizes this mix of global and local discourse to retain spaces for practicing their intangible cultural heritage and cultural rights to natural resources.