Superstars exist in classrooms and workplaces. Superstars can intimidate others and create a negative performance shock, or they can encourage others by inspiring everybody to “step up their game.” In this study, we examine two effects: the impact of head-to-head competition with a superstar (direct) effect and the influence of a superstar presence on players' performance (indirect) effect. We find that the direct superstar effect in theory and in the data is always negative. The indirect superstar effect is neutral in theory, but depends on the intensity of the superstar in the data: if the skill gap between the superstar and the rest is small (large), there is a positive (negative) indirect effect.