A large literature has focused on how capital – human, social, and economic – influences immigrant economic attainment. However, few studies have explored how other factors, namely racialization processes, contribute to these within group differences. We examine the role of skin tone as a source of intra-group difference that stratifies outcomes among Mexican immigrants in the early twentieth century. We create a new dataset of Mexican border crossing records between 1910 and 1940 that we then link to the 1940 census. We use at-entry characteristics to predict income in 1940 and find that—in line with dominant assimilation theories—standard measures of capital are associated with within-group differences in attainment. However, we also find that skin tone was a source of within-group stratification: being perceived as having darker skin is associated with lower subsequent economic attainment compared to those with lighter skin. Furthermore, we find that these patterns vary across contexts such that skin tone had a greater effect in Texas, while standard measures of skill had stronger effects in California. Taken together, we argue that while standard measures of assimilation typically predict later outcomes, the stratifying effects of skin tone has been a long-run feature of Mexican immigrant history.