Public housing residents have long experienced stigma as members of an urban “underclass.” One policy response is the creation of mixed‐income developments; by deconcentrating poverty and integrating residents into communities in which their residences are indistinguishable from neighbors, such efforts might reduce stigma associated with residency in traditional public housing. Through in‐depth interviews with 35 relocated public housing residents and 184 field observations at three mixed‐income developments in Chicago, we find this is not the case. Stigma associated with living in public housing is ameliorated, yet residents report that their experience of stigma has intensified in other ways. The negative response of higher‐income residents, along with stringent screening and rule enforcement, amplifies the sense of difference many residents feel in these contexts. We demonstrate that this new form of stigma has generated a range of coping responses as relocated public housing residents seek to maintain eligibility while buttressing their social identity.