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In the large body of research on sentencing, no question has received more attention than whether ethnic minority defendants are treated more harshly than similarly situated white defendants. The 2017 Lammy Review commissioned by two UK governments showed that ethnic minority groups in the UK are disproportionately represented in the Criminal Justice System and experience worse sentencing outcomes. Despite the stark ethnic inequalities presented in the review, there is little empirical evidence about the factors that explain differential sentencing outcomes, and the independent effect of ethnicity net of other well-established predictors of sentencing outcomes. This paper draws on Ministry of Justice magistrates’ and Crown Court datasets and multi-level models, to examine the relative contribution of defendant (extra-legal), case (legal) and court factors in explaining the likelihood of a custodial sentence and sentence length and to determine whether ethnic disparities persist after controlling for other factors that explain these outcomes. The analysis shows that legal characteristics such as plea, pre-trial detention, offence type and severity are important factors determining sentencing outcomes although they do not fully explain disparities in these outcomes between ethnic groups. Ethnic disparities in imprisonment persist and, in some cases, become more pronounced after controlling for individual defendant, case and court factors. In contrast, ethnic disparities in sentence length are largely explained by legal factors, and after adjusting for other predictors of sentencing outcomes, observed differences between most (but not all) ethnic minority groups and the white British disappear. The paper concludes by discussing the theoretical and policy-relevant implications of these findings.