Little is known about ethnic and racial disparities in mental health care among Medicaid beneficiaries. The association between ethnicity and race and the utilization of mental health care was explored in six Medicaid programs. The analysis distinguished between different settings of care, including community-based, outpatient hospital, inpatient, and emergency departments (EDs). Racial and ethnic disparities in mental health care were observed across state Medicaid programs. Hispanic and African American beneficiaries with mental illness were much less likely than Whites to be treated in community-based settings. African Americans were more likely to receive mental health treatment in inpatient, ED, and outpatient hospital settings in some states. The implications of these findings and possible initiatives to enhance community-based mental health care among African American and Hispanic Medicaid beneficiaries are discussed.