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Background: Little evidence exists on the differential health effects of COVID-19 on disadvantaged population groups. Here we characterise the differential risk of hospitalisation and death in Sao Paulo state, Brazil and show how vulnerability to COVID-19 is shaped by socioeconomic inequalities. Methods: We conducted a cross-sectional study using hospitalised severe acute respiratory infections (SARI) notified from March to August 2020, in the Sistema de Monitoramento Inteligente de Sao Paulo (SIMI-SP) database. We examined the risk of hospitalisation and death by race and socioeconomic status using multiple datasets for individual-level and spatio-temporal analyses. We explained these inequalities according to differences in daily mobility from mobile phone data, teleworking behaviour, and comorbidities. Findings: Throughout the study period, patients living in the 40% poorest areas were more likely to die when compared to patients living in the 5% wealthiest areas (OR: 1.60, 95% CI: 1.48 - 1.74) and were more likely to be hospitalised between April and July, 2020 (OR: 1.08, 95% CI: 1.04 - 1.12). Black and Pardo individuals were more likely to be hospitalised when compared to White individuals (OR: 1.37, 95% CI: 1.32 - 1.41; OR: 1.23, 95% CI: 1.21 - 1.25, respectively), and were more likely to die (OR: 1.14, 95% CI: 1.07 - 1.21; 1.09, 95% CI: 1.05 - 1.13, respectively). Interpretation: Low-income and Black and Pardo communities are more likely to die with COVID-19. This is associated with differential access to healthcare, adherence to social distancing, and the higher prevalence of comorbidities.

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