Both the housing bubble and the subprime meltdown ratcheted up levels of class and racial inequality to levels not seen since the 1930s. In the nation's increasingly diverse suburbs, this has meant both new forms of interaction and new forms of division. This dissertation looks at these dynamics through the eyes of an often-ignored subject--youth. Through an ethnographic examination of young people's transition to high school during the subprime crisis, I explore the ways in which a new economic paradigm--one based largely on dispossession--is transforming the educational and cultural lives of both very wealthy and very poor suburban youth. I introduce the framework of "education by dispossession" as a means of linking the current economic paradigm to the ongoing transformation of the educational institutions, ideologies, spaces and practices these youth encounter.