Ss were given instruction sets to induce either on-line or memory-based processing while reading behavioral statements about individual and group targets. Impression-set instructions induced online judgments, and comprehensibility-set (comp) instructions induced memory-based judgments regardless of target type. More important, with nondirective instructions (memory set), natural differences in processing information about individuals and groups were observed, with more online judgments for individuals. As expected, illusory correlations between minority targets and infrequent behaviors (a memory-based product) emerged with comp instructions (which induced memory-based judgments for both target types) and in the memory-set condition for group targets only. These data provide insights into the differences in impression formation for groups and individuals and furnish direct evidence of the processes responsible for illusory correlations.