This article focuses on the physical composition of the Eastern Indonesian provincial town of Kupang, a town thought to be characterized by interethnic tensions. I examine the assumption that social segmentation is explainable in terms of ethnicity. In order to show that ethnicity not the sole explanation for social segregation, I draw on urban anthropological insights proposing an anthropology of cities—and in particular Setha M. Low's concept of the “divided city”—to look at the kinds of social segmentation that are suggested by the development of new residential areas in Kupang. When comparing the composition of Kupang during colonial times to its current lay-out, it becomes clear that, even though Kupang started out as a city characterized by ethnic segmentation, it has been developing towards a city based on class-segmentation. This class-segmentation reflects access to state employment and resources. Nevertheless, being a provincial town instead of a larger metropolis, class segmentation (physically or socially) is far from rigid. As such, provincial towns can form a fascinating space to explore physical segregation, social stratification and social mobility. [Eastern Indonesia, Kupang, West Timor, ethnicity, class segmentation].