Over the past few decades, school choice has been a widely debated issue around the globe, following the development of pluralism, liberty, and democracy. In many countries, school choice systems were preceded by residence-based school assignment systems, creating a strong connection between a neighborhood and its schools’ demographic compositions. However, schools often remain highly segregated. School segregation is thus seen as a major problem and is supposedly driven by three main factors: residential segregation, parental school choice, and schools’ selection of pupils. This paper aims to shed light on what research should be focusing on as regards school choice and residential segregation with the following two research questions: What are the links between neighborhood and school choice in the literature? How are neighborhood and school choice connected to school segregation in the literature? Two main findings emerged: (1) the neighborhood-based social networks that parents developed had limited their school choices and (2) neighborhood segregation is one of the most important factors that contributes to school segregation and is related to multi-ethnic and socioeconomic contexts.