In 1929 Michael and his brother Francis moved to Hoboken to rejoin their mother, their stepfather Armando, and new sister Adelaide; sister Iole and brother Armando, Jr. (Arcy) followed.   Hoboken, a famous mile-square emigrant city, was composed of several distinct ethnic enclaves.  Michael's new home was in the Irish-American area, 4th Street and Park Avenue, neighboring Our Lady of Grace Church and School, A. J. Demerest (the Hoboken High School), and a central, small park.  Michael's introduction to this area, as the only Italian name in an Irish neighborhood, was exciting, and because of it he developed some significant relationships and an interest in boxing, which he followed into the Hudson County Golden Gloves Competition in the mid 1930s.  "I learned early on that if I was to survive then I had to learn how to fight.  So I joined the Hudson County Golden Gloves, where I learned how to box, and, more importantly, I learned how to take care of myself."

As a result of the 1930s economic collapse and Depression, the Castellini family moved several times within Hoboken, ending up in an upscale mixed-ethnic area at 10th and Bloomfield Streets.  One of their neighbors was the Sinatra family; Dolly Sinatra, the mother of Frank, and Mary Castellini, Michael's mother, became close friends.  The Castellini family in the 30s often vacationed in Long Branch, New Jersey.  During one summer vacation, young Francis Albert Sinatra was a guest and slept with Michael in the boys' bunkroom.

Michael matriculated through Our Lady of Grace Grammar School (serving as altar boy at 5 a.m. Mass all those years), David E. Rue Middle School, and A. J. Demerest, the Hoboken High School.  At Demerest, the freshman class advisor and math teacher, Thomas Gaynor, and the school principal, Arthur Stover, were both graduates of Stevens Institute of Technology.  With their encouragement Michael became socially and academically active and proficient, being groomed for the entrance requirements of Stevens.