This thesis brings together psychological and sociological research approaches to examine the role of personality in the reproduction of educational and labour market inequality. The first research question examines the influence of personality on educational and labour market outcomes. The second research question relates to the extent to which differences in personalities of children and parents can explain the reproduction of educational inequality. The third research question inquires to what extent supportive parenting influences the development of favourable or unfavourable personality traits. The thesis employs an empirical approach and uses quantitative methods. The German Socio-Economic Panel (GSOEP) and its sub-sample from the Youth Questionnaire are used to conduct the analyses. To capture personality, the Big Five and Locus of Control are applied. The educational outcomes investigated are maths grades and school placement for 17-year-old, as well as years of education and income for adults. The study uses data on education, socio-economic background, and personality measures spanning two generations: the parents and the children. With respect to the first research question, results indicate positive effects of Openness to Experience, Conscientiousness and Locus of Control, and a negative effect of Neuroticism on school placement. Effects of personality on grades were found to a lesser degree. In auto-regressive cross-lagged models, personality and income have reciprocal effects over a time span of 10 years, where different personality traits show different patterns over time. Regarding the second research question, results indicate that personality does not explain the effect of parental education on children’s school outcomes, however it is found post-hoc, that parents’ personality traits mediate the effect of socio-economic status measured with the Erikson-Goldthorpe class scheme. Results for the third research question suggest, that children who report a high degree of supportive parenting show a stronger development of beneficial personality traits.