The aim of the study was to compare how young adults experience their identity formation in relation to both their own as well as to another residential areas class character. The study had a comparative approach and two socioeconomically diverse areas in the Municipality of Växjö were studied. The study's empirical work consists of qualitative interviews with young adults from the residential areas Araby and Öjaby. The empirical data were analysed with the help of Erik H Erikson's theory of identity, Pierre Bourdieu's theory of social class and John L Scotsons and Norbert Elias's theory of established and outsiders. The results of the study showed that young adults feel that their residential area has a considerable impact regarding to their identity formation. The results also showed that an area's reputation has a strong impact on how individuals in the area are perceived. All respondents in the study felt that people from the socioeconomically privileged area had better life conditions than people from the socioeconomically disadvantaged area. These conditions include the school situation as well as the labour market.