Does living in a low-income neighborhood have negative health con-sequences? We document causal neighborhood effects on health by ex-ploiting a Spatial Dispersal Policy that quasi-randomly resettled refugeesacross neighborhoods from 1986-1998. The risk of developing a lifestylerelated disease before 2018 increased by 5.1 percent for those allocatedto the poorest third of neighborhoods compared with those in the richestthird of neighborhoods. Our results suggest that interaction with neigh-bors and the characteristics of the immediate environment are importantdeterminants for health outcomes. Differences in health care access, ethnic networks, and individual labor market outcomes cannot explain ourfindings