This book explores the developments in central–local government relations in Japan, with special reference to the landmark lawsuit brought in 1973 by a city in Osaka prefecture against the central government. In Japan, as in all other developed industrial nations, the scale and scope of state activity has expanded dramatically during this century. This expansion has particularly affected local governments, which have become responsible for providing an increasing range of public services. Perhaps the most important question is how increased state activity is transformed into these changes. The dynamics of the actual processes is an unexplored yet important aspect of contemporary Japanese politics.