In several matching markets, to achieve diversity, agents' priorities are allowed to vary across an institution's available seats, and the institution is let to choose agents in a lexicographic fashion based on a predetermined ordering of the seats, called a (capacity-constrained) lexicographic choice rule. We provide a characterization of lexicographic choice rules and a characterization of deferred acceptance mechanisms that operate based on a lexicographic choice structure under variable capacity constraints. We discuss some implications for the Boston school choice system and show that our analysis can be helpful in applications to select among plausible choice rules. 1 | INTRODUCTION Many real-life resource allocation problems involve the allocation of an object that is available in a limited number of identical copies, called the capacity of the object. Choice rules, which are systematic ways of rationing available copies of an object when demand exceeds the capacity, are essential in the analysis of such problems. A well-known example is the school choice problem in which each school has a certain number of seats to be allocated among students. Although student preferences are elicited from the students, endowing each school with a choice rule is an essential part of the design process. Which choice rule to use is not always evident. The school choice literature, starting with the seminal study by Abdulkadiroğlu and Sönmez (2003), has widely focused on problems