The health status of populations of the countries of Central and Eastern Europe and the former Soviet Union underwent major changes after the fall of communism. While mortality started declining in Central Europe, mortality in Russia and most other countries of the former Soviet Union rose dramatically and has yet to improve. In terms of the socioeconomic changes, some countries (mainly Central Europe) were able to contain the fall in income and rise in income inequalities, but across the former Soviet Union gross domestic product plummeted and income inequality grew rapidly. This led to two types of inequality: first, the widening gap in mortality between countries, and second, the increasing social gradient in health and disease within countries. The thrust of our argument is that the disadvantages in health in Eastern Europe, and the growing social inequalities in health in the region, are direct results of the social changes, and that psychosocial factors played a pivotal role in the health pattern seen in Central and Eastern Europe.