Federalism was introduced in the Basic Law with the explicit aim of the allied occupation powers to foster a decentralised reconstruction of the German state. The principle of federalism, like that of democracy, is permanently incorporated in the Basic Law. This chapter examines how federalism can be defined and how can German federalism can be characterised. It reviews the concept of federalism and its applications to the Federal Republic of Germany, and proposes a framework for the analysis of German federalism based on an investigation of the evolution of the allocation of competence between Federal government and Lander in one policy-area over a long period of time. The chapter also reviews the approaches put forward by a number of scholars for the analysis of German federalism. Closely related to the focus on federalism is the question of whether and to what extent Lander have maintained control of higher education policy-making.