A spatial multigrid algorithm for isotropic neutron transport is presented in x-y geometry. The linear system is obtained using discrete ordinates in angle and corner balance finite differencing in space. Spatial smoothing is accomplished by a four-color block-Jacobi relaxation, where the diagonal blocks correspond to 4-cell blocks on the spatial grid. A bilinear interpolation operator and its transpose are used for the grid transfer operators. Good convergence factors were observed for homogeneous material properties. Heterogeneous material properties prove more difficult, especially the case of a vacuum region surrounded by a thick, diffusive region. In this case, a small amount of absorption, or "effective absorption" in a time-dependent problem, restores good convergence. Numerical results are presented.