Abstract: The paper illustrates the evolution of the territorial system of government in Italy. A traditionally centralized state is turning into a quasifederation. The reasons underpinning this transformation are the growing insatisfaction with the inefficiency of the central government, the quest for autonomy by the fastest growing regions and the opposition by the latter to the interterritorial redistribution of resources made by the central government with the use of nontransparent and inefficient instruments.