This chapter analyzes the reasons behind the formation of alliances between United States contractors and between US and European defense contractors, as illustrated by several case studies of alliances, as well as assesses some of the patterns in alliance formation. Government officials can also protest ensuing job loss if combined production facilities from the alliance result in a loss of jobs in one country. Alliances between US defense firms and foreign firms are exposed to some of the same concerns as mergers, such as concerns over the potential of US jobs going overseas and national security concerns over technology transfer. Nevertheless, although alliances undergo some scrutiny, it can be easier for the parties involved in the alliance to limit the degree of their involvement with each other, at least initially, than would be the case in a merger. Butler, Kenny, and Anchor discuss strategic alliances within the European defense industry.