To describe the structure of production and the organization of exchange of obsidian chipped stone during the Middle Postclassic period (AD 1200–1350) in south-central Veracruz, Mexico, I analyzed 65 residential inventories from the center of Sauce and its hinterland. Previous research on obsidian production found a spatial association with Sauce, which could support the political administration of exchange, or alternatively, identify market exchange nearby. I argue that reliance on spatially based models alone for identifying exchange mechanisms is not advisable because of potential equifinality, in which different forms of exchange appear alike. Local obsidian artifacts have additional interpretive complications: they come from a single geological source, there was universal access to them, and they were employed in potentially specialized activities. I used the articulation of production combined with spatial distribution and residential contextual information to distinguish between redistribution and market exchange. Results indicate that market exchange is the main mechanism. The largest concentrations of primary production indicators and the highest quantities of blade segments were found near the Sauce center, which suggest that political elites at Sauce encouraged market exchange, although they did not direct it to the extent that they were controlling significant amounts of obsidian.