Racism has become more covert in post-civil rights America. Yet, measures to combat it are hindered by inadequate general knowledge on what “colorblind” race talk says and does and what makes it effective. We deepen understanding of covert racism by investigating one type of discourse – racial code words, which are (1) indirect signifiers of racial or ethnic groups that contain (2) at least one positive or negative value judgment and (3) contextually implied or salient meanings. Through a thematic analysis of 734 racial code words from 97 scholarly texts, we develop an interpretive framework that explains their tropes, linguistic mechanisms and unique roles in perpetuating racism, drawing from race, linguistic and cultural studies. Racial code words promote tropes of White people’s respectability and privilege and Racial/Ethnic Minorities’ pathology and inferiority in efficient, adaptable, plausibly deniable and almost always racially stratifying ways, often through euphemism, metonymy and othering. They construct a “colorblind” discursivity and propel both “epistemic racism” (racism in knowledge) and systemic racism (racism in action). We further strengthen applications of Critical Race Theory in sociolegal studies of race by presenting a “racial meaning decoding tool” to assist legal and societal measures to detect coded racism.