This paper examines the impact of air quality on housing values using the Clean Air Act Amendments of 1970 as a quasi-experimental approach. The legislation imposed strict regulations on polluters in "nonattainment" counties, defined by high levels of total suspended particulates (TSPs) pollution. The authors exploit the structure of the Clean Air Act to estimate the capitalization of TSPs pollution into housing values. They find that the elasticity of housing values with respect to particulate concentrations ranges from -0.20 to -0.35, indicating a significant willingness to pay for clean air. The improvements in air quality induced by the mid-1970s TSPs nonattainment designation are associated with a $45 billion aggregate increase in housing values in nonattainment counties between 1970 and 1980. The results suggest that the hedonic method can be successfully applied in certain contexts to estimate the economic value of clean air.This paper examines the impact of air quality on housing values using the Clean Air Act Amendments of 1970 as a quasi-experimental approach. The legislation imposed strict regulations on polluters in "nonattainment" counties, defined by high levels of total suspended particulates (TSPs) pollution. The authors exploit the structure of the Clean Air Act to estimate the capitalization of TSPs pollution into housing values. They find that the elasticity of housing values with respect to particulate concentrations ranges from -0.20 to -0.35, indicating a significant willingness to pay for clean air. The improvements in air quality induced by the mid-1970s TSPs nonattainment designation are associated with a $45 billion aggregate increase in housing values in nonattainment counties between 1970 and 1980. The results suggest that the hedonic method can be successfully applied in certain contexts to estimate the economic value of clean air.