The organization of schools in Sweden has recently taken a significant turn toward neo-liberalism. A number of elements are involved. In this article we point to a risk of self segregation in these developments by means of which ethnic minority, economically disadvantaged and immigrant groups become concentrated in the same schools, within mainly the public sector. We also suggest that these schools thus face serious difficulties when it comes to creating encounters between different social, ethnic and religious groups as a school capable of mobilization for citizenship. We need such schools but there is no evidence that schools are developing in these directions in the neo-liberal era.