On the night of her election victory in 1987, Margaret Thatcher announced that tackling the difficulties in the inner cities was to be a major goal of her third term. But while government policy is said to be highly geared to physical renewal and regeneration of the local economy, it addresses only the more immediately visible manifestations of urban decay. In this critical analysis, MacGregor and Pimlott review the impact of government policy on social conditions in contemporary British cities, challenging conventional images of increasing prosperity and arguing that recent developments and reforms to improve the situation in the inner cities have often made things worse for those who live there.