Federal arrangements have been considered by some thinkers as a panacea for containing ethnic nationalism in the ethnically defined regions. This article challenges this view by arguing that federal institutions may enable ethnic nationalists in the ethnically defined regions to consolidate their power through the guarantees that they receive from the federal centre. Although the post-Soviet Russian leadership under Boris Yeltsin sought to use federalism as a tool for containing ethnic nationalism, Russia's this experiment with federalism demonstrates that federalism may serve not to contain but to strengthen ethnic nationalism. Disillusioned with Yeltsin's failed use of federalism in containing ethnic nationalism, the overwhelming majority of the Russian people supported Vladimir Putin's anti-federalist reforms since 2000 which made federalism redundant in Russia. While undermining the basis for Western style democracy in Russia, Putin's centralism proved to be more effective than Yeltsin's federalism in containing ethnic nationalism.