The Problem of the Local State and New Trends in the Transformation of the Local State H. Tarık Şengül After drawing the theoretical framework within which the changing form of the relation between the state and the urban space should be considered, the article deals with the concrete developments concerning the transformation of the local state, in the Keynesian and neoliberal periods, with reference to both developed and underdeveloped countries. It, then, analyzes the transformation of the local state in Turkey by focusing on the current debates on the “local government reform”. It shows how the failure of the neoliberal policies brought to the agenda the “crisis of the local state” and asserts that the basic factor behind the crisis lies in the failure of forming a local state structure corresponding to the model of the “competitive cities” which had become a dominant paradigm in the neoliberal period. Another crucial point underlined in the article is that though the proposals for reform geared to decentralization are defended for the sake of “democratization and participation”, the current drafts for reform are far from fulfilling these objectives.