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Interpretive institutional ethnography is useful for studying issues of equity and educational opportunity within and, particularly, across the social institutions and agencies that exist to enhance the well-being and life chances of children and youth. Two primary questions frame this paper: How can the capability approach be operationalized in ethnographic studies of social service institutions and agencies and how can the needs of children and youth be illuminated both inside and outside of schools? Interpretive institutional ethnography provides scholars who are engaged in equity & capability research with a useful methodological lens for operationalizing this framework. This methodology will also appeal to anyone interested in ethnographic inquiry and equity in education.