Policies aimed at increasing urban integration are currently amongst the most important priorities for the UK government. However, there is little evidence that policy attempts to induce mixing have been successful in the long run. Hence, the thesis addresses the following four questions. First, how do patterns of segregation arise? Second, why do they persist? Third, can they be changed by policy? Fourth, can we solve the methodological problems associated with modelling neighbourhood change? The thesis argues that population patterns - including levels of deprivation and segregation arise from the interactions between housing market choice, labour markets and neighbourhood status.