AT THE BEGINNING OF 1997, after ve years of failed reforms in the defence industry, there took place a substantial change in the administrative structure running this sector. The Ministry of Economic Affairs took over the restructuring of the defence industry and thereby de ned a new way of tackling reforms in this industrial sector. Three elements stand out in the new approach: intersectorality, a predominance of civilian elements and a greater realism. This approach, therefore, represents a break with the idea in force up to that moment of the best way to tackle problems related to the defence industry, which was greatly conditioned by its Soviet heritage. Although two years later this new way of approaching the restructuring of the defence industry has come under question, it can be claimed that some of the changes introduced will condition the future industrial policy implemented in this sector. This article aims to do two things: rstly, to highlight whether relevant decisions have been made in the restructuring of this sector during the time it has been under the control of the Ministry of Economic Affairs and secondly, to point out the restructuring tendencies once the main objective of this industry, speci cally the supply of weapons, had been achieved. This article will concentrate only on those aspects related to domestic weapons demand, this being the element that gives meaning to the defence industry in itself. In the rst place, the situation inherited by the Ministry of Economic Affairs will be set out, as will, in connection with this, the aims of the restructuring programme. In the second place, the changes which took place in the sector as a whole will be examined, focusing on considerations of its size as well as on reforms introduced in the methods of internal reorganisation. Thirdly, some limits which are relevant to the industrial policy adopted will be pointed out. The analysis of these issues will be carried out in the light of the de facto priorities of weapons production, in such a way that it will end by underlining the relationship between the model of the future Russian defence industry and the production of weapons necessary to meet the domestic requirements.