Racial segregation is often blamed for some of the achievement gap between blacks and whites. We study
the effects of school and neighborhood segregation on the relative SAT scores of black students across
different metropolitan areas, using large microdata samples for the 1998-2001 test cohorts. Our models
include detailed controls for the family background of individual test-takers, school-level controls for
selective participation in the test, and city-level controls for racial composition, income, and region. We
find robust evidence that the black-white test score gap is higher in more segregated cities. Holding
constant family background and other factors, a shift from a fully segregated to a completely integrated
city closes about one-quarter of the raw black-white gap in SAT scores. Specifications that distinguish
between school and neighborhood segregation suggest that neighborhood segregation has a consistently
negative impact but that school segregation has no independent effect (though we cannot reject equality of
the two effects). We find similar results using Census-based data on schooling outcomes for youth in
different cities. Data on enrollment in honors courses suggest that within-school segregation increases
when schools are more highly integrated, potentially offsetting the benefits of school desegregation and
accounting for our findings.