In this paper, the environment is defined as the macro- and community-level factors, including physical, legal and policy factors, that influence household and individual decisions. Thus, environment is conceived as the external context in which household and individual decisions are made. This paper reviews the literature on the ways the environment affects diet, physical activity, and obesity. Other key environmental factors discussed include economic, legal, and policy factors. Behind the major changes in diet and physical activity in the US and globally lie large shifts in food production, processing, and distribution systems as well as food shopping and eating options, resulting in the increase in availability of energy-dense foods. Similarly, the ways we move at home, work, leisure, and travel have shifted markedly, resulting in substantial reductions in energy expenditure. Many small area studies have linked environmental shifts with diet and activity changes. This paper begins with a review of environmental influences on diet and physical activity, and includes the discussion of two case studies on environmental influences on physical activity in a nationally representative sample of US adolescents. The case studies illustrate the important role of physical activity resources and the inequitable distribution of such activity-related facilities and resources, with high minority, low educated populations at strong disadvantage. Further, the research shows a significant association of such facilities with individual-level health behavior. The inequity in environmental supports for physical activity may underlie health disparities in the US population.