Decades of apartheid policies have resulted in marked racial inequalities in health in South Africa. The black:white rate ratio of diarrhoea among children aged less than five years, one of the five most common causes of infant and child deaths, stood at 6.5 in 1998. Using data from the 1998 South African Demographic and Health Survey, this paper examines the mechanisms of this racial disparity. The research confirms the presence of persistent racial inequalities in access to safe drinking-water and sanitation and in maternal education and household wealth, with the black population constituting the most disadvantaged group. While the living environment and access to safe drinking-water explain the excessive risk of diarrhoea among the black population compared to the coloured and Indian populations, the excessive risk of diarrhoea among the black population compared to the white population cannot be explained by disparities in the living environment, hygiene levels, and socioeconomic factors.