Recent decades have seen a rapid increase in the flows of non-European immigrants into public housing in Europe, which led to concern regarding the rise of “ghettos” in large cities. Using French census data over three decades, we examine how this increase in public housing participation affected segregation. While segregation levels increased only moderately on average, we find that the number of immigrant enclaves has grown. The growth of enclaves is driven by the large increase in non-European immigrants in the census tracts where the largest housing projects are located, both in public and private housing. As a result, contemporary differences in segregation levels across metropolitan areas are shaped by the spatial distribution of housing projects within cities and by the share of immigrants who live in large projects. Nevertheless, the overall effect of public housing on segregation has been ambiguous. While large projects increased segregation, the inflows of non-European immigrants into small housing projects brought many immigrants into census tracts where they have previously been rare and thus diminished segregation levels. However, the characteristics of non-European immigrants vary across projects, and those observed in the less segregated housing projects have a higher socio-economic status.