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Admixed populations are routinely excluded from genomic studies due to concerns over population structure. Here, we present a statistical framework and software package, Tractor, to facilitate the inclusion of admixed individuals in association studies by leveraging local ancestry. We test Tractor with simulated and empirical two-way admixed African–European cohorts. Tractor generates accurate ancestry-specific effect-size estimates and P values, can boost genome-wide association study (GWAS) power and improves the resolution of association signals. Using a local ancestry-aware regression model, we replicate known hits for blood lipids, discover novel hits missed by standard GWAS and localize signals closer to putative causal variants.