This paper discusses the concepts of vulnerability and susceptibility and their relevance for understanding and tackling health inequalities. Tackling socioeconomic inequalities in health is based on an understanding of how an individual's social position influences disease risk. Conceptually, there are two possible mechanisms (not mutually exclusive): there is either some cause(s) of disease that are unevenly distributed across socioeconomic groups (differential exposure) or the effect of some cause(s) of disease differs across groups (differential effect). Since differential vulnerability and susceptibility are often used to denote the latter, we discuss these concepts and their current use and suggest an epidemiologically relevant distinction. The effect of social position can thus be mediated by causes that are unevenly distributed across social groups and/or interact with social position. Recent improvements in the methodology to estimate mediation and interaction have made it possible to calculate measures of relevance for setting targets and priorities in policy for health equity which include both mechanisms, i.e. equalize exposure or equalize effects. We finally discuss the importance of differential susceptibility and vulnerability for the choice of preventive strategies, including approaches that target high-risk individuals, whole populations and vulnerable groups.