Previous studies suggest that measuring ethnic segregation at a disaggregated level allows capturing variability of ethnic concentration areas within a city. However, many ignore the relative locations of each neighbourhood to identify ethnic concentration areas. It causes misidentification of ethnic concentration areas. Using the 2009 population data of Enschede, this study investigated the concentration areas at postcode level. The “scale of the neighbourhood” represents the extent of concentration influenced by population in neighbouring postcodes. Using composite population at different scales of neighbourhood, it was revealed that concentration areas at sub-city level are characterized by isolation and clustering dimensions. Few postcodes are Turkish or Moroccan concentration areas which are located outside the city center. Small number of cluster and isolated area indicates that the ethnic concentration in Enschede is relatively low. The study has advanced the hypothesis about segregation measurement, that spatial proximity to neighbouring areas has a large impact on variability of ethnic segregation.