This study drew data from a randomized trial of a statewide prekindergarten program in Tennessee and presents new evidence on the impacts of preK on third-grade achievement using administrative data on children's neighborhood environments. Results indicate that preK had no measurable impact on children's third-grade math achievement regardless of children's neighborhood conditions. However, preK significantly improved third-grade reading achievement for children living in high-poverty neighborhoods. The treatment effects on reading achievement were substantial: Among children living in high-poverty neighborhoods, those who took up an experimental assignment to attend preK scored over half a standard deviation higher on average than the control group in third grade. In contrast, preK enrollment had, if anything, a negative effect on third-grade reading achievement among children living in low-poverty neighborhoods. These differential effects were partially explained by alternative childcare options and contextual risk factors.