The association between neighborhood disadvantage and crime has been extensively studied, but most studies have relied on cross-sectional data and have been unable to separate potential effects of the neighborhood from selection effects. We examined how neighborhood disadvantage and offender concentration are associated with criminal behavior while accounting for selection effects due to unobserved time-invariant characteristics of the individuals. We used a registry-based longitudinal dataset that included all children aged 0-14 living in Finland at the end of year 2000 with follow-up until the end of 2017 for criminal offences committed at ages 18-31 years (n = 510,189). Using multilevel logistic regression with a between-within approach we examined whether neighborhoods differed in criminal behavior and whether within-individual changes in neighborhood disadvantage and offender concentration were associated with within-individual changes in criminal behavior. Our results indicated strong associations of most measures of neighborhood disadvantage and offender concentration with criminal behavior between individuals. The within-individual estimates accounting for selection related to unobserved individual characteristics were mostly non-significant with the exception of higher neighborhood disadvantage being associated with increased risk for violent crimes. Our findings suggest that criminal behavior is better explained by individual characteristics than by causal effects of neighborhoods.