This article provides an overview of some of the key changes brought about by the groundbreaking Framework Agreement (known as the Ohrid Agreement) in Macedonia since its signing in 2001. A power-sharing arrangement, it saved Macedonia from the brink of civil war. This article describes how the Ohrid Agreement restored peace by addressing the constitutional status of minorities, their equitable representation in the public sector and issues connected with higher education in the 2002–2006 period. It further assesses the merits of (...) decentralization as a remedy for safeguarding a unitary state in a multi-ethnic environment. It consequently argues that the Ohrid Agreement and the ensuing reforms have been important steps in the right direction revitalizing Macedonia by empowering not only the sizeable Albanian population but other less numerous communities as well. However, daunting challenges remain ahead. The perception and language gap between the two main ethnic communities hinder efforts for a truly functioning multi-ethnic state. Moreover, the new government formed after the July 2006 general elections has stirred controversy and caused tensions affecting its Euro-Atlantic perspective. To what extent this will affect Macedonia’s multi-ethnic democracy remains to be seen. (shrink)