Since the introduction of regional autonomy legislation in 1999, Indonesia has embarked on the world’s biggest experiment with democratic decentralization. The intertwined processes of democratization and decentralization have dismantled Indonesia’s centralized authoritarian system and reordered its governmental structures. These conjoined processes have set in motion conditions for the transformation of a number of Indonesia’s secondary cities into regional ‘centers’ through the influx of new peoples, funding and ways of interacting within localized contexts and with the outside world. In this article I consider Indonesia’s decentralization processes through the lens of the city, focusing on three key areas in the rising profile and development of urban centers. First, I look at the framing of Indonesian cities within contemporary urban discourses to highlight the array of urban spaces that coexist in the era of decentralization. Second, I describe how Indonesia’s decentralization laws have structurally privileged cities by bypassing the provincial level and devolving most state powers directly to sub‐provincial administrations. Third, I explore how Indonesian cities compete and cooperate over limited state resources under the decentralized system and why some cities have been able to reinvent themselves as new centers in planning, practice and innovation, and why others continue to lag behind.