Evidence from six Mexican states is analyzed about changes in government organisation and performance arising from decentralisation and the recasting of federalism structures. Spurred by rising pluralism, greater electoral transparency, alternancia, and willingness of the Centre to ‘let go’, a more genuine structure of shared powers is emerging between the executive (governors), the legislature and the judiciary. The government bureaucracy is undergoing modernisation, and governors are seeking to share power with legislatures as a means of sharing the responsibilities of statecraft. Local congresses are exercising greater ‘checks’ and ‘balances’ vis-à-vis the executive branch. Finally, the judiciary is beginning to be reorganised, particularly at the national (Supreme Court) level, where it is starting to develop jurisprudence relating to inter- and intra-governmental relations.