A large corpus of literature investigates how the presence of ethnic and economic out-group affects pro-social behavior. However, some long-standing theoretical controversies have not yet been resolved and empirical results are mixed. On the one hand, researchers associated with social identity and group-threat theories argue that out-group presence will drive down the pro-social behavior towards the out-group members. On the other hand, social contact theorists claim that residing in the ethnically and economically mixed neighborhoods will have a positive infuence as social contact reduces out-group prejudice. One way to reconcile these two theoretical streams is to take the geographical clustering of social groups into account. Residential segregation will reduce the likelihood of inter-group cooperation by limiting inter-group contact opportunities as well as making group boundaries more salient. My study tests this hypothesis by linking neighborhood-level social indicators and detailed individual-level data on charitable giving to refugees in Germany. I find that likelihood of giving to refugees declines in the city-level immigrant share. However, this effect is driven by the german natives living in the predominantly german neighborhoods.