The paper presents a spatial microsimulation approach to the analysis of health inequalities. A dynamic spatial microsimulation model of Britain, under development at the Universities of Leeds and Sheffield, uses data from the censuses of 1971, 1981 and 1991 and the British Household Panel Survey to simulate urban and regional populations in Britain. Geographical information systems and spatial microsimulation are used for the analysis of health inequalities in British regions in a 30 year simulation. The interdependencies between socio-economic characteristics and health variables such as limiting long-term illness are discussed. One of the innovative features of the model is the estimation of variables such as household income at the small area level, which can then be used to classify individuals. The health situation of different simulated individuals in different areas is investigated and the role of socio-economic characteristics in determining health is evaluated.