Asthma is the number one chronic health condition facing children today; however, little is known about rural-urban inequalities in asthma. This "area effects on health" study examines rural-urban differences in childhood asthma hospitalizations within the state of Texas using negative binomial regression models. Effects associated with residence on the Texas-Mexico border, where the majority of rural Texas children live, are also considered. Neighborhood-level social class and proportion of the population that was native-born Hispanic were significant predictors of asthma hospitalizations, independent of rural-urban location. Conversely, proportion African American, Native American, and foreign-born Hispanic, not a citizen; median year of home construction; and neighborhood location on the Texas-Mexico border were conditional on urban-rural location, and the strength of these predictors was stronger in rural areas. This suggests that locational and social factors intersect in marginalized spaces (like the rural and border regions of Texas) to create vulnerability to asthma hospitalizations. (Contains 2 footnotes, 2 tables and 2 figures.)