An effort is made in this paper to contribute to recent debates, inspired by the regulationist literature, on the restructuring of capitalist society. A major weakness in this literature concerns the treatment of the state, and especially the local state. Despite the fact that the state is clearly identified as a key component of any mode of regulation, the actual processes through which economic and social forces are translated into state activity are rarely examined, Moreover, these forces are usually assumed to operate at the national scale, but in this paper it is contended that the practices and relations of regulation also operate locally. These local spaces of regulation arise not only because of the uneven development of capitalist societies, but also because local agencies are often the very medium through which regulatory practices arc interpreted and ultimately delivered. The local state is thus a key component in these local modes of regulation, and will be implicated in any transition from one mode to another. These issues are examined by looking at the changing nature of urban politics in three British ‘cities’: Sheffield, Bracknell, and Camden in inner London. It is concluded that the local state is both an object and an agent of regulation, which itself needs to be regulated so that its strategies and structures can be used to help forge a new social, political, and economic settlement.