This paper uses data drawn from the European Union Labour Force Survey 2000 Ad Hoc Module on School to Work Transitions to explore the influence of gender and social background (measured in terms of parental education) on young people's educational and early labour market outcomes across 12 European countries. Our results show that social background is strongly related to the level of education achieved while gender is found to have a stronger effect on the field of study selected. Countries vary in the extent to which gender and social background affect young people's outcomes. Gender differentiation in labour market outcomes reflects the nature of the welfare regime, being more pronounced in familial and conservative systems. Social inequality in educational attainment and early labour market outcomes are less marked in Finland and Sweden, reflecting the combination of less differentiated educational systems, mass higher education and social-democratic welfare regimes. In contrast, social inequality is more marked in the Eastern European countries, due partly to their highly differentiated educational systems but more notably to rapid changes taking place in post-communist systems. (Contains 2 tables, 7 figures and 5 notes.)