In this article the authors examine evidence pertaining to the implementation of a national programme of school-based decentralization, the Quality Schools Programme ("Programa de Escuelas de Calidad"). The main argument of this article is that high levels of inequality in the institutional capacity of different schools and in the financial capacity of different communities minimize the likelihood that this school-based management programme might, in the short term, contribute to closing the gaps in educational opportunity for students from different socio-economic groups who are segregated in different types of schools. The heterogeneity in school and community resources and capacities conditions the way in which teachers and principals respond to the incentives provided by the programme, with the least changes observed in the least-endowed schools. The authors posit three key mechanisms that explain why school-based management (SBM) does not close equity gaps in educational opportunity in Mexico: first, selection mechanisms, which make entry into the programme more likely for the schools with greater capacity and resources, principally urban schools; second, organizational mechanisms at the school level, which make school-based management work better for schools that have adequate leadership and coherence of vision among school staff; third, management mechanisms and politics at the system level which undermine local initiative in the most vulnerable schools. (Contains 6 tables, 1 figure and 9 notes.)