Many countries are increasingly being challenged to integrate their growing immigrant populations. A major key to successful integration is the educational attainment of immigrant offspring. According to the results of comparative studies, second-generation immigrant students often lag behind their non-immigrant counterparts even though the host countries perform very differently with respect to the education of immigrant offspring. This study investigates how the interplay between the degrees of stratification and standardization in education systems and the degree of ethnic school segregation affects the performance gap between non-immigrant and second-generation immigrant students in member countries of the Organisation for Economic Co-operation and Development (OECD). Based on data from three waves of the OECD Programme for International Student Assessment (PISA) study (2003, 2006, and 2009), this article presents a country fixed effects approach to analyzing repeated cross-sectional data by investigating how changes in education policies and institutional contexts are associated with non-immigrant–immigrant reading performance gap. Between-school stratification was associated with lower performance of second-generation immigrants relative to native students, particularly when paired with ethnic school segregation, whereas within-school stratification (ability grouping) was associated with higher relative performance of the immigrant students. In addition, the non-native students benefited from less standardization of educational input, because performance gaps were smaller when a country’s educational resources were distributed unequally. [ABSTRACT FROM AUTHOR]