Rural California is becoming increasingly Latino. At the same time, the economic well-being of California’s agricultural communities is increasingly defined by the race and ethnicity of residents. A number of studies have noted that communities with high concentrations of Latinos tend to have greater economic and social problems. This paper examines both the out-migration of non-Hispanic Whites and the in-migration of Latinos in rural California, to achieve a better understanding of the relationship between ethnicity and the economic wellbeing of California’s rural communities. The first part of the paper uses a database of 126 rural California communities to compare and contrast demographic changes (during 1980-90) in Latino and non-Latino population, and examines the degree to which White out-migration and Latino in-migration correlate with community socio-economic indicators. The second part of the paper uses in-depth qualitative data to examine several communities in the San Joaquin valley.