The authors examined racial similarities and differences in depressive symptomatology, diagnosis, and the predictors of depression in four independent nursing homes, conducting analyses across all sites and separately for the nursing home with the greatest racial balance (NH4). All-site data indicated that white residents showed more depression than black residents. There were no racial differences in the depression diagnosis derived from a structured interview of DSM-III-R. At NH4, there were no statistically significant racial differences in any of the measures of depression. Across sites, functional disability was the strongest predictor of both Geriatric Depression Scale (GDS) and DSM-III-R diagnosis of depression in both blacks and whites. Cognitive impairment and use of antidepressants were predictive of medical chart diagnosis of depression across sites, but not of depression measured by GDS or DSM-III-R criteria. At NH4, functional disability was predictive of GDS depression, but only among whites. Age was not an important predictor of depression. Results indicate the importance of considering the method used to diagnose depression and the necessity of controlling for the nursing home setting when examining racial differences in depression.