This article examines the role that social capital plays in school success and in the explanation of social and ethnic inequalities in the German educational system. Based on Coleman's well-known concept of social capital, different aspects of social capital are distinguished, including social network composition, parent-school interaction and intrafamilial social capital. In sum, the overall results indicate that the different aspects of social capital influence the school performance of pupils. In addition, social capital endowment is found to be of relevance for the explanation of inequalities in school grades between social classes and ethnic groups. In this respect, the analyses indicate that social capital endowment is part of the underlying mechanism responsible for educational inequalities.