In the US and western Europe, mixing policies are widespread. They aim to differentiate various income-groups in deprived neighbourhoods. By constructing 'expensive' housing units, the middle classes are encouraged to settle in these neighbourhoods and consequently a concentration of low-income-groups is circumscribed. Such a new population composition is assumed to lead to an improved quality of life in the neighbourhood concerned. However, insufficient attention is paid to ethnicity and interethnic dynamics; these aspects will be elaborated on in two case studies of deprived and ethnically differentiated neighbourhoods in Amsterdam. Furthermore, this paper will also explore the impact of ethnic differences and perceptions on the social contacts and interactions between various ethnic groups of residents. © 2008 Urban Studies Journal Limited.