This study examined the extent to which racial disparities in service utilization exist in veterans (VA) and non-VA health care systems. An observational study design was used with a nationally representative sample of veterans. Logistic regression models were constructed using sociodemographic characteristics, health insurance and benefits, and health status as predictors of health service use in both VA and non-VA health care systems. A population weighted sample of 19,270 veterans from the 2001 National Survey of Veterans was used, which included 17,004 (88.24%) White, 1,864 (9.15%) African American, 414 (2.15%) Native American/Alaskan Native, and 87 (0.45%) Asian American/Pacific Islander veterans. Results showed that use of the VA health care system was not associated with race, but was associated with VA disability compensation, lack of private health insurance, and greater health care need. Contrarily, in non-VA healthcare systems, veterans who were racial minorities, less educated, and without private health insurance were less likely to use services. Together, these findings demonstrate the socioeconomic context in which health disparities exist and suggest the influence of health insurance on racial disparities in service utilization.