Undocumented immigration has been linked to a wave of anti-immigrant legislation during the early 1990s. California led the way by passing Proposition 187, which many suspect led legal immigrants to naturalize. No research has confirmed this suspicion. I argue that the years before, during, and after the legislation’s passage and the strength of the labor market represent two contexts of reception in which immigrants reside, which determine naturalization decisions. Event history models show that California’s naturalization rates dramatically increased after the legislation’s passage, a pattern that is most pronounced among Latinos, while rates declined during difficult times, a pattern more pronounced among Asians. Thus, Latinos’ naturalization rates are affected more by the state policy climate, while Asians rates are affected more by long-term economic health.