The effect of COVID-19 lockdowns on ambient air pollution levels in urban south-central Chile, where outdoor air pollution primarily originates indoors from wood burning for heating, may differ from trends in cities where transportation and industrial emission sources dominate. This quasi-experimental study compared hourly fine (PM2.5) and coarse (PM10) particulate matter measurements from six air monitors (three beta attenuation monitors; three low-cost sensors) in commercial and low/middle-income residential areas of Temuco, Chile between 2019 and 2020. The potential impact of varying annual meterological conditions on air quality was also assessed. During COVID-19 lockdown, average monthly ambient PM2.5 concentrations in a commercial and middle-income residential neighborhood of Temuco were up to 50% higher (from 12 to 18 μg/m3) and 59% higher (from 22 to 35 μg/m3) than 2019 levels, respectively. Conversely, PM2.5 levels decreased by up to 52% (from 43 to 21 μg/m3) in low-income areas. The fine fraction of PM10 in April 2020 was 48% higher than in April 2017-2019 (from 50% to 74%) in a commercial area. These changes did not appear to result from meterological differences between years. During COVID-19 lockdown, higher outdoor PM2.5 pollution from wood heating existed in more affluent areas of Temuco, while PM2.5 concentrations declined among poorer households refraining from wood heating. To reduce air pollution and energy poverty in south-central Chile, affordability of clean heating fuels (e.g. electricity) should be a policy priority.