This article contributes to the broader scientific debate on how the state generates and modifies life chances of individuals and social groups by highlighting a specific way of institutional (re-)production of social inequalities: it explores the nature and impact of immigrant-specific state intervention. Building on the concept of “modes of incorporation” by Portes and colleagues, a theoretical section explicates how specific contexts of reception by the host government may impact on integration outcomes. An empirical study applies this model to Germany – an example of moderate socio-economic immigrant selection, but extensive legal stratification. I demonstrate substantial effects of differential government reception and legal status on socio-economic outcomes among adult immigrants and their children. A concluding section outlines how the model presented here could help advance comparative studies of immigrant incorporation.