The thesis provides a critical assessment of international involvement in the task of postconflict state consolidation of Bosnia and Cyprus. It aims to account for the inconsistent record of success of international actors in their attempts to institute and implement powersharing agreements in Bosnia and Cyprus. In particular, the thesis focuses on the impact of international incentives on the policies and discourse of the Bosnian Serb and the Turkish Cypriot secessionist elite in respect to the post-conflict state unification agenda. Much of the literature on third-party sponsored conflict management is optimistic about the possibility for conflict resolution through external intervention, especially in states offered the prospect of EU membership. The confidence in the transformative power of international incentives relies on the presumption that there is sufficient willingness and ability on the ‘external’ side to apply its leverage in support of policies that would promote more consensual inter-ethnic relations in aspiring member states. A further presumption posited by the literature, is that domestic socialisation into international/EU normative framework can yield discursive and identity changes in aspiring member states, in turn decreasing the salience of borders and reducing the potential for ethno-territorial conflict. What is missing from many of these studies is a more empirically driven discussion of problems related to the ‘exercise of power’ by a multiplicity of international actors in postconflict, deeply divided societies, typically characterised by a low level of democratic consolidation. The thesis attempts to make a contribution by filling this gap through an indepth study of interaction between the international actors and domestic elite in the autonomous entities of Bosnia and Cyprus, offering a more context-based approach to the preferences and conduct of actors on both sides of the power relationship. Central to the analysis of domestic preferences is how the exercise of the autonomy in an illiberal context, and the rent-seeking opportunities which the elite enjoys in such a setting, affect the positions of the ruling elite on the state-consolidation agenda. Nationalist elites are found to be instrumental players who hold vested interests in maintaining the status quo and are endowed with various institutional and discursive opportunities which frequently allow them to resist and delegitimize internationally sponsored reforms. As such, the thesis outlines multiple domestic challenges related to the exercise of ‘hard power’ and legitimacy the outsiders face in post-conflict interventions. Further question pursued is the extent to which international actors are capable of meeting these challenges through a coordinated strategy, how the available resources of power are applied in practice, how effective these are given the domestic institutional opportunity structures, and finally, what degree of legitimacy international actors are able to confer to their interventions. Significant normative and practical constraints to mobilising, effectively applying resources, and legitimising international intervention are identified. As a result of these domestic challenges and external constraints, the thesis proposes an alternative view of the interaction between external and domestic actors in post-conflict contexts to that presented by conventional IR approaches, which generally conceptualise it as power asymmetry in favour of the former. This relationship is better described as ongoing bargaining, as well as what I refer to as a legitimacy contest, more akin to the Morgenthau’s understanding of power as a psychological relationship, of which legitimacy is an important component. Further, contrary to the idea that external policy is fixed and that the domestic actors follow a straightforward logic of either obstruction or compliance, this interaction is seen as an ongoing contestation, in which both sides use various strategies to pursue and legitimize their agendas, frequently adapting their positions and often deviating from stated policy objectives and official rhetoric.