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People classified as 'blancos' (whites) were the insulares or "Filipinos" (a person born in the Philippines of pure Spanish descent), peninsulares (a person born in Spain of pure Spanish descent), Español mestizos (a person born in the Philippines of mixed Austronesian and Spanish ancestry), and tornatrás (a person born in the Philippines of mixed Austronesian, Chinese and Spanish ancestry). Manila was racially segregated, with blancos living in the walled city of Intramuros, un-Christianized sangleys in Parían, Christianized sangleys and mestizos de sangley in Binondo, and the rest of the 7,000 islands for the indios, with the exception of Cebu and several other Spanish posts. Only mestizos de sangley were allowed to enter Intramuros to work for whites (including mestizos de español) as servants and various occupations needed for the colony. Indio were native Austronesians, but as a legal classification, Indio were those who embraced Roman Catholicism and Austronesians who lived in proximity to the Spanish colonies.^{[citation needed]}

People who lived outside Manila, Cebu and the major Spanish posts were classified as such: 'Naturales' were Catholic Austronesians of the lowland and coastal towns. The un-Catholic Negritos and Austronesians who lived in the towns were classified as 'salvajes' (savages) or 'infieles' (the unfaithful). 'Remontados' (Spanish for 'situated in the mountains') and 'tulisanes' (bandits) were indigenous Austronesians and Negritos who refused to live in towns and took to the hills, all of whom were considered to live outside the social order as Catholicism was a driving force in Spanish colonials everyday life, as well as determining social class in the colony. People of pure Spanish descent living in the Philippines who were born in Spanish America were classified as 'americanos'. Mestizos and africanos born in Spanish America living in the Philippines kept their legal classification as such, and usually came as indentured servants to the 'americanos'. The Philippine-born children of 'americanos' were classified as 'Ins'. The Philippine-born children of mestizos and Africanos from Spanish America were classified based on patrilineal descent.

The term negrito was coined by the Spaniards based on their appearance. The word 'negrito' would be misinterpreted and used by future European scholars as an ethnoracial term in and of itself. Both Christianized negritos who lived in the colony and un-Christianized negritos who lived in tribes outside the colony were classified as 'negritos'. Christianized negritos who lived in Manila were not allowed to enter Intramuros and lived in areas designated for indios.

A person of mixed Negrito and Austronesian ancestry were classified based on patrilineal descent; the father's ancestry determined a child's legal classification. If the father was 'negrito' and the mother was 'India' (Austronesian), the child was classified as 'negrito'. If the father was 'indio' and the mother was 'negrita', the child was classified as 'indio'. Persons of Negrito descent were viewed as being outside the social order as they usually lived in tribes outside the colony and resisted conversion to Christianity.

This legal system of racial classification based on patrilineal descent had no parallel anywhere in the Spanish-ruled colonies in the Americas. In general, a son born of a sangley male and an indio or mestizo de sangley female was classified as mestizo de sangley; all subsequent male descendants were mestizos de sangley regardless of whether they married an India or a mestiza de sangley. A daughter born in such a manner, however, acquired the legal classification of her husband, i.e., she became an India if she married an indio but remained a mestiza de sangley if she married a mestizo de sangley or a sangley. In this way, a chino mestizo male descendant of a paternal sangley ancestor never lost his legal status as a mestizo de sangley no matter how little percentage of Chinese blood he had in his veins or how many generations had passed since his first Chinese ancestor; he was thus a mestizo de sangley in perpetuity.

However, a 'mestiza de sangley' who married a blanco ('Filipino', 'mestizo de español', 'peninsular', or 'americano') kept her status as 'mestiza de sangley'. But her children were classified as tornatrás. An 'India' who married a blanco also kept her status as India, but her children were classified as mestizo de español. A mestiza de español who married another blanco would keep her status as mestiza, but her status will never change from mestiza de español if she married a mestizo de español, Filipino, or peninsular. In contrast, a mestizo (de sangley or español) man's status stayed the same regardless of whom he married. If a mestizo (de sangley or español) married a filipina (woman of pure Spanish descent), she would lose her status as a 'filipina' and would acquire the legal status of her husband and become a mestiza de español or sangley. If a 'filipina' married an 'indio', her legal status would change to 'India', despite being of pure Spanish descent.

The social stratification system based on class that continues to this day in the country had its beginnings in the Spanish colonial area with a discriminating caste system.^[109]

The social stratification system based on class that continues to this day in the country had its beginnings in the Spanish colonial area with a discriminating caste system.^[110]

The Spanish colonizers reserved the term Filipino to refer to Spaniards born in the Philippines. The use of the term was later extended to include Spanish and Chinese mestizos, or those born of mixed Chinese-indio or Spanish-indio descent. Late in the 19th century, José Rizal popularized the use of the term Filipino to refer to all those born in the Philippines, including the Indios.^[111] When ordered to sign the notification of his death sentence, which described him as a Chinese mestizo, Rizal refused. He went to his death saying that he was indio puro.^[112][111]

The Spanish caste system based on race was abolished after the Philippines' independence fro