The research tested the hypothesis that socioeconomic factors are significant predictors of incarceration rate in that the percent nonwhite and the percent of the population living in poverty would be positive predictors of incarceration rates. These hypotheses are grounded in Marxist and cultural conflict theories. The models were estimated separately and controlled for four measures of crime: index crime, violent crime, index and drug law offenses, and violent crime and drug law offenses. Results revealed that the direct effect of percent nonwhite was a significant predictor of incarceration rates in only two of the eight equations examined. In the case of percent nonwhite, these results are mostly likely because of the high level of multicollinearity. The indirect effect of percent nonwhite was substantial. In four of the equations, the indirect effect was greater than the direct effect. Findings did not support the hypothesis that the level of poverty was positively related to incarceration. Findings indicated the need for further research on the influence of race and inequality on incarceration, particularly because of the war on drugs. Findings also suggested nonwhites' greater likelihood than whites of being arrested and imprisoned for drug law offenses may make race a more important determinant of incarceration rates in the future. Note and 40 references (Author abstract modified)