The programme of dismantling German factories for reparations caused the biggest crisis in the relationship between British and the Germans during the apost-Second World War occupation years. By 1949, the peak year for dismantling in the British Zone, the Germans were convinced that the British, alone among the Allies, were pushing for continued dismantling, and that they were doing so for purely commercial reasons. The dismantling campaign has been almost exclusively by economic historian, with the consensus being that its effect was limited. This raises the question of why it turned into such a bitter political conflict. My thesis explores the dismantling programme from this angle. I show that the renewed dismantling programme from 1947 onwards caused rifts inwards in the British occupation apparatus, as the punitive aspects of the dismantling campaign and the strong German reaction against it started threatening what the British saw as their positive mission in Germany, re-educating the Germans. It caused a rift between the Allies, as the US Congress started a massive campaign to end dismantling in connection with the Marshall Aid, and with the French vacillating between ending and continuing dismantling. In Germany itself, the dismantling programme became an issue where the political parties, industry groups and labour unions sought to exploit the groundswell of popular discontent against dismantling for their own, wider political goals, often with a troublesome nationalistic rhetoric. Dismantling as a major political issue ended with the Petersberg agreement in November 1949. By this time the conflict over dismantling had festered for so long that it was relatively easy for the Adenauer government to sideline the British and focus their attentions on rapprochement with France and European economic integration. The most original part of the research focuses on how British debates on whether to proceed or end dismantling, and how British dismantling policies were shaped by other occupation goals focused on a particular British conception of power. The British increasingly saw dismantling as influencing British prestige, meant to compensate for lagging relative power. I define what the British meant by their prestige in this question, its imperial origins and how it failed.