This report reviews the economic literature investigating the effects of the share of immigrants in classes and schools on the school performance of immigrants and natives. The review is organized in four sections. In the first section, we document the recent expansion in the presence of immigrants in European schools, introduce a measure of school segregation and show how this measure correlates with school performance. The second section looks at the equity and efficiency implications of school segregation. We discuss under what conditions policies that reallocate students from schools with a high share of immigrants to schools with a low share can improve efficiency. In the third section we review the empirical evidence on the effects of the share of immigrants on the school performance of natives and immigrants. Policies that address the school segregation of immigrants are discussed in the final section. [This is an Analytical Report of the European Expert Network on Economics of Education (EENEE) prepared for the European Commission.]