The debate about the black-white price differential in housing is clarified in this paper. The theoretical literature on this differential is reviewed, and it is shown how the various theories can be tested in a regression of house values on housing characteristics. A properly specified house-value regression leads not only to tests of hypotheses about the black-white price differential but also to measures of this differential. The econometric specification derived in this paper is estimated using data for owner-occupied houses in St. Louis in 1967. These estimates provide support for hypotheses about the effects on the price of housing of racial attitudes and of discrimination against blacks. It is also found that a black-white price differential exists both between neighborhoods and within neighborhoods; the price of equivalent housing is about 25% higher in highly integrated and largely black neighborhoods than in all-white neighborhoods, and, within any given neighborhood, blacks pay about 15% more than white for equivalent housing. (Author/AM)