Neighborhoods provide essential resources (eg, education, safe housing, green space) that influence neurodevelopment and mental health. However, we need a clearer understanding of the mechanisms mediating these relationships. Limited access to neighborhood resources may hinder youths from achieving their goals and, over time, shape their behavioral and neurobiological response to negatively biased environments blocking goals and rewards. To test this hypothesis, 211 youths (aged ∼13.0 years, 48% boys, 62% identifying as White, 75% with a psychiatric disorder diagnosis) performed a task during functional magnetic resonance imaging. Initially, rewards depended on performance (unbiased condition); but later, rewards were randomly withheld under the pretense that youths did not perform adequately (negatively biased condition), a manipulation that elicits frustration, sadness, and a broad response in neural networks. We investigated associations between the Childhood Opportunity Index (COI), which quantifies access to youth-relevant neighborhood features in 1 metric, and the multimodal response to the negatively biased condition, controlling for age, sex, medication, and psychopathology. Youths from less-resourced neighborhoods responded with less anger (p< .001, marginal R2= 0.42) and more sadness (p< .001, marginal R2= 0.46) to the negatively biased condition than youths from well-resourced neighborhoods. On the neurobiological level, lower COI scores were associated with a more localized processing mode (p= .039, marginal R2= 0.076), reduced connectivity between the somatic-motor-salience and the control network (p= .041, marginal R2= 0.040), and fewer provincial hubs in the somatic-motor-salience, control, and default mode networks (all pFWE< .05). The present study adds to a growing literature documenting how inequity may affect the brain and emotions in youths. Future work should test whether findings generalize to more diverse samples and should explore effects on neurodevelopmental trajectories and emerging mood disorders during adolescence. One or more of the authors of this paper self-identifies as a member of one or more historically underrepresented racial and/or ethnic groups in science. One or more of the authors of this paper self-identifies as a member of one or more historically underrepresented sexual and/or gender groups in science. One or more of the authors of this paper received support from a program designed to increase minority representation in science. We actively worked to promote sex and gender balance in our author group. We actively worked to promote inclusion of historically underrepresented racial and/or ethnic groups in science in our author group.