Previous literature finds that organizations with salient local identities perform better than its competitors in the market. However, no previous study considers what will happen when the regions with whom these organizations identify become stigmatized. How will organizations react then? What is the role that different audiences play in organizations´ decisions on whether to stay or disengage from the stigmatized region? This study investigates the impact of regional stigmatization on organizations with a salient local identity. It proposes that when organizations with salient local identities operate in local markets, there are less changes they disengage from the stigmatized market. Instead, if they expand their boundaries and operate in markets with non-local audiences, they will be more prone to symbolically disengage from the stigmatized region. We test this intuition in the context of the independence conflict in Catalonia by looking at the firms that stayed and the ones that moved their social headquarters from Catalonia to other regions in Spain as a symbolic response of disengagement from the source of the stigma. We contribute to the literatures on organizational identities, local communities and categorical stigma as one of the first studies that suggests that choosing a salient local identity may not always be a positive tool for organizations and that they may suffer directly negative consequences if the region with whom they identify becomes stigmatized.