Using geocoded data from the Panel Study of Income Dynamics, this article e
xamines why the number of high-poverty neighborhoods in American cities has
increased since 1970. The main findings are (1) the migration of the nonpo
or away from moderately poor neighborhoods has been a key process in formin
g new high-poverty neighborhoods, although in the early 1980s increasing po
verty rates were also important; and (2) African-Americans have moved into
predominately white neighborhoods at a pace sufficient to increase their nu
mbers there, but neighborhoods with increasing black populations tend to lo
se white population rapidly. Implications for theories of poor neighborhood
s are discussed.