In this paper it has been argued that there are several important variables to consider in explaining the distribution of residential neighborhoods. These include (1) the overall tendency for urban populations to be concentrated about central places and along major transportation facilities, (2) the pattern of social relations which exist among the subgroups which comprise the community's population, (3) the major (common) residential values held by members of the community, and (4) the community power structure. It has been noted that the first of these factors has received more than its share of attention, and that, indeed, most attempts to explain residential structure seek to associate compositional characteristics in a fixed way to the settlement density and competition for land. Because the relationship between composition and density is mediated by many institutional and social variables, however, this approach is not considered very promising. Instead, it is suggested that attention be directed to all four elements, and especially to the second, dealing with the social relations that exist among the subgroups of the community. The careful study of these relations should provide an important key to the understanding of the residential structure of the modern American metropolis.