This chapter examines whether Iraq is a failed state and how it drew such characterization. It focuses on the period since the U.S.-led invasion of Iraq in 2003 that toppled Saddam Hussein. The chapter considers three areas: the reconstruction of Iraq’s political institutions; post-invasion violence and security; and human and economic development. It shows how the failure to reconstruct political institutions capable of reconciling Iraq’s different political groupings has weakened central government, exacerbated corruption within state institutions, and contributed to ethnic/sectarian violence, thereby creating a favourable environment for the emergence of the Islamic State. The chapter argues that the Iraqi state is failing to provide necessary services and infrastructure for economic and human development and even basic security for much of the population.