To determine whether African-American children with asthma use more emergency department (ED) and inpatient medical services and fewer preventive services than white children with similar insurance coverage and family income.Historical cohort study during Medicaid claims data.Aid to Families With Dependent Children enrollees aged 3 through 17 years in Seattle-Tacoma, Wash, metropolitan area.All 576 African-American children and 1369 white children receiving services for asthma between June 1988 and December 1992.Utilization of asthma services (ED, impatient, office visits, and pharmacy) and well-child services and associated Medicaid reimbursements.African-American children were more likely than white children to make ED visits or to be hospitalized for asthma; adjusted odds ratios (ORs) were 1.70 (95% confidence interval [Cl], 1.34 to 2.15) and 1.42 (95% Cl, 1.03 to 1.96), respectively. African-American children were less likely to have made an office visit for asthma; the adjusted OR was 0.48 (95% Cl, 0.26 to 0.85). The two groups were similarly likely to have filled a prescription for an asthma medication and to have made a well-child visit. Per capita payments for asthma services were 24% higher for African-American children: $436 vs $350 per child-year.Higher use of ED and inpatient services for asthma among African-American children using Medicaid (compared with white children) cannot be fully explained by poverty or inadequate health insurance. Furthermore, these children appear to make disproportionately few office visits for asthma, suggesting suboptimal use of preventive services for asthma. In contrast, the comparable use of well-child visits in the two groups suggests the problem may not be in access to care in general, but there may be specific problems in the successful management of chronic diseases such as asthma among African-American children.