The socioeconomically detrimental consequences of ethnic or religious discrimination in Israel is shown to depend on the degree of community segregation. Part of the low levels of achievement of Jews of Asian or African origin is attributable to a disadvantageous distribution across Israeli communities. However, competing with Jews of European or American origin, Asian-Africans are disadvantaged at every step in the attainment process. The low attainment of Arabs is largely attributable to their low social origins. Their community and institutional segregation from Jews protects them from further socioeconomic subordination. It follows that community, occupation, and religion interact in Israel, while community, occupation, and ethnicity do not. Hence, we reach two general conclusions: (1) Communities within one small country do differ in the way ascriptive status functions in the process of socioeconomic attainment; and (2) what is important about communities for the attainment of subordinate groups is the extent the community segregates the subordinate group from the dominant one.