Objective The aim of the study is to evaluate whether health inequalities associated with unemployment are comparable across different ethnic groups. Method A random sample of inhabitants of the city of Rotterdam filled out a questionnaire on health and its determinants, with a response of 55.4% (n = 2,057). In a cross-sectional design the associations of unemployment, ethnicity, and individual characteristics with a perceived poor health were investigated with logistic regression analysis. The associations of these determinants with physical and mental health, measured by the Short Form 36 Health Survey, were evaluated with linear regression analyses. Interactions between ethnicity and unemployment were investigated to determine whether associations of unemployment and health differed across ethnic groups. Results Ill health was more common among unemployed persons [odds ratio (OR) 2.6; 95% CI 1.7–3.8] than workers in paid employment. Health inequalities between employed and unemployed persons were largest among native Dutch persons (OR = 3.2) and Surinamese/Antillean persons (OR = 2.6), and smaller in Turkish/Moroccan persons (OR = 1.6) and overseas refugees (OR = 1.6). The proportions of persons with poor health that could be attributed to unemployment were 14, 26, 14, and 13%, respectively. Conclusions Differences in ill health between employed and unemployed persons were less profound in ethnic groups compared to the majority population, but the prevalence of unemployment was much higher in ethnic groups. The population attributable fractions varied between 14 and 28%, supporting the argument that policies for health equity should pay more attention to measures that include persons in the labour market and that prevent workers with ill health from dropping out of the workforce.