The role of online communities of the extreme-right in the radicalization of individuals involved in political violence has received increased public attention due to recent tragic events around the world. In this policy brief, we provide a systematic account of the psychological processes underpinning the formation and transformation of these communities. Our analysis is built on the premise that these communities can be understood as ideologically driven psychological groups, and as such their collective beliefs, values, and norms are key to understanding their actions. Drawing on findings from research into an Australian extreme-right online community, we show how these collective beliefs, values, and norms can change in the aftermath of particular socio-political events in the offline domain. We conclude by proposing strategies that can be used to direct policy and recommendations for research in the area.