In the early 1990s, the Neighborhood Revitalization Program (NRP) allocated $400 million in public funds for Minneapolis neighborhood groups to spend on improvement projects over the coming 20 years. NRP created the most financially empowered structure of neighborhood governance in any American city. This article describes the institutional design of NRP and then explores several of its political, social and economic consequences. In particular, we examine the character of participation, deliberation and conflict in several NRP neighborhoods, the tensions between neighborhood groups and city offices over this decentralization initiative, the effects of decentralization upon neighborhood‐level social capital, and the nature of goods funded under the Program.