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The extent to which racial/ethnic disparities in pneumonia care occur within or between hospitals is unclear.Examine within and between-hospital racial/ethnic disparities in quality indicators and mortality for patients hospitalized for pneumonia.Retrospective cohort study.A total of 1,183,753 non-Hispanic white, African American, and Hispanic adults hospitalized for pneumonia between January 2005 and June 2006.Eight pneumonia care quality indicators and in-hospital mortality.Performance rates for the 8 quality indicators ranged from 99.4% (oxygenation assessment within 24 hours) to 60.2% (influenza vaccination). Overall hospital mortality was 4.1%. African American and Hispanic patients were less likely to receive pneumococcal and influenza vaccinations, smoking cessation counseling, and first dose of antibiotic within 4 hours than white patients at the same hospital (ORs = 0.65–0.95). Patients at hospitals with the racial composition of those attended by average African Americans and Hispanics were less likely to receive all indicators except blood culture within 24 hours than patients at hospitals with the racial composition of those attended by average whites. Hospital mortality was higher for African Americans (OR = 1.05; 95% CI = 1.02, 1.09) and lower for Hispanics (OR = 0.85; 95% CI = 0.81, 0.89) than for whites within the same hospital. Mortality for patients at hospitals with the racial composition of those attended by average African Americans (OR = 1.21; 95% CI = 1.18, 1.25) or Hispanics (OR = 1.18; 95% CI = 1.14, 1.23) was higher than for patients at hospitals with the racial composition of those attended by average whites.Racial/ethnic disparities in pneumonia treatment and mortality are larger and more consistent between hospitals than within hospitals.