The first section of this paper surveys academic research on educational achievement with an emphasis on the relative effects of schools and families in shaping educational outcomes. A methodology section provides a summary of data sources and defines the main variables measured. The paper then examines differences in school test score performance among different racial/ethnic/income groups, how these differences vary across metropolitan areas, and implications for educational outcomes. Subsequent findings explore potential explanations for school inequality, including large gaps in housing costs, which are correlated with exclusionary zoning laws. The paper concludes with a brief discussion of public policy implications. (Contains 8 tables, 4 figures and 112 endnotes.)