Abstract: The paper describes the main aspects of the recently introduced 'federal' system in the Sudan and discusses some of its implications, particularly for development planning at the sub-national level. The scarcity of human and financial resources in the country, the maintenance of tight political control over the new state organs and the recent increase in the number of states do not augur well for the capacity of the new states to deal effectively with their own development problems. Recent trends in regional planning - towards identification of opportunities, mobilisation of resources and development promotion at the local and regional levels - add to the challenges that the newly created decentralised administration will face.