OBJECTIVES: To examine racial and ethnic disparities in receiving total hip replacement surgery among eligible patients. METHODS: Using a nationally-representative inpatient care dataset, the HCUP National Inpatient Sample, from 1998 to 2007, we had an available sample of 317,766 Caucasians, 34,339 African Americans, 18,138 Latinos, 3,805 Asians, and 923 Native Americans who were eligible for the total hip replacement surgery. Multivariable logistic regressions were used to estimate the racial and ethnic disparities of actually receiving the replacement surgery among eligible patients. The Blinder-Oaxaca decomposition techniques were employed to determine the extent to which disparities reflect differences in observable population characteristics versus unobserved heterogeneity across racial and ethnic groups.  RESULTS: Approximately 77% of Caucasians, 51% of African Americans, 46% of Latinos, 51% of Asians, and 56% of Native Americans who were eligible to receive total hip replacement surgery actually received it. These disparities persisted in the multivariable regressions. Compared to Caucasians, the odds of having total hip replacement surgery was 0.52 for African Americans (p<0.0001), 0.41 for Latinos (p<0.0001), 0.44 for Asians (p<0.0001), and 0.47 for Native Americans (p<0.0001). The Blinder-Oaxaca decomposition method revealed that 43%-53% of the observed differences between Caucasians vs. African Americans, Latinos, and Asians in receiving total hip replacement surgery can be explained by observed population characteristics, among which differences in age, health insurance coverage, and gender are the major factors associated with these disparities. In contrast, observed population characteristics only explained 3% of the differences between Caucasians vs. Native Americans. CONCLUSIONS: Substantive racial and ethnic disparities exist in total hip replacement surgery. Observable population characteristics account for most of these differences (with the exception of Native Americans), with age and health insurance being key factors. Unobserved heterogeneity such as unobserved physician-patient relationships, mistrust, and cultural factors, is also related to the disparities, especially for the disparities between Caucasians and Native Americans.