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This research examines the relationship between community unemployment and the physical and mental health of immigrants in comparison to non-immigrants in Montreal under the hypothesis that high unemployment in the community may generate more negative effects on the health of immigrants than on non-immigrants. Possible gender differences in these associations are also examined. Montreal residents were studied via multilevel analysis, using both individual survey data and neighbourhood data from 49 police districts. Individual-level data were excerpted from a 1998 health survey of Montreal residents, while neighbourhood data originated from survey data collected in the 49 Montreal police districts and the 1996 Canadian Census. The associations between community unemployment and self-rated health, psychological distress and obesity are examined, and hypotheses regarding the modifying mechanisms via which male and female immigrants may run a greater risk of poor health than non-immigrants when living in areas of high unemployment were tested. Between neighbourhoods, variations in the three health outcomes were slight, and differences in health were not associated with differences in community unemployment. The associations between community unemployment and health varied according to immigration status. At the individual level, immigrants do not differ from non-immigrants with respect to the three health indicators, except that second-generation males are slightly heavier. However, when living in areas of high unemployment, immigrants tend to report poor physical and mental health in comparison to non-immigrants. Among first-generation immigrants, community unemployment was associated with psychological distress. Among second-generation immigrants, the probability of obesity and poor self-rated health increased significantly for those living in areas with high unemployment, but these associations reached statistical significance only for men. Findings among first-generation immigrants are interpreted with respect to the effects of possible discrimination in areas with low job availability. Among second-generation men, poor physical health and obesity may be the result of poor health habits stemming from perceived lack of life opportunities.