While digital storytelling has entered higher education as a vehicle to reflect on issues of identity and difference, there is a paucity of research framed by a critical perspective unpacking underlying power structures in the classroom. This study reports on an ongoing project in a South African pre-service Teacher Education course in which final-year students reflected in the form of digital stories on the notion of difference and how it affected their journey to becoming a teacher. Drawing on theories of resistance, counterstorytelling and multimodality, five of these digital stories, students' reflective essays and discussions in a focus group were analysed to investigate types of resistance in students' narratives, their perceptions of the functions of counterstorytelling, and what multimodal analysis of these stories could tell us about the relationship of students' identities, their choice of modes and their learning. Results of the study showed students' intent to develop so-called "counterstories", defined as stories that challenge social and racial injustice, which are usually not heard in education. Students also perceived telling of counterstories as useful to building communities among marginalised students, acting as model stories, providing an alternative window into the world of students of colour and a space for healing. While only one story could be defined as portraying "transformational resistance", carrying the highest potential for social change, others were important documents of disadvantaged students' fight for survival, and might well challenge some of the existing power structures in their classroom. Multimodal analysis of the stories revealed contradictory elements, highlighting the difficulty for students to resist dominant discourses, but also showing the increasing (conscious or unconscious) emotional audience manipulation evidenced in production of digital stories by the more privileged students. We suggest that engaging students in multimodal analysis of their own stories could facilitate a nuanced conversation on consciously and unconsciously held beliefs and assumptions, as well as an awareness of themselves that may lead to questioning the dominant discourse they have been socialised in.