The first post-Taliban year in Afghanistan after the U.S.-led Operation Enduring Freedom shaped the political environment in which President Hamid Karzai’s Transitional Administration functions. Three major challenges will determine Afghanistan’s long-term reconstruction: establishing a stable government based on the Bonn Accords, providing security through enhanced peacekeeping, and rebuilding a collapsed economy. The long-term commitment of the United States and the international community to reconstruction will be critical to preventing a return to state failure and a resurgence of militant Islamism. Also important will be development of a federal system that fits Afghanistan’s inherent localism without reinforcing the power of resurgent warlords.