The Uzbekistani state declared mahalla kengash as a local self-government in order to achieve decentralization in its administrative system. This thesis is a critical study of whether decentralization can be an explanatory concept in the examination of new institution-building in Uzbekistan. This thesis claims that dialectic relationship between the center and local state becomes conflictual when there is inconsistency between (a) (national) ruling class and its hegemony, and (b) (local) ruling class and its hegemony. The hegemony of both national and local ruling classes is shaped according to their capacity for conformity/dissention with the Soviet regime, and neo-liberal structural hegemony. This study based on a case study of Tashkent mahallashas demonstrated that decentralization process has been reversed as a result of the strategies of the Uzbekistani state when the different responses of the mahalla kengash do not conform to mahalla imagined by the state. Shortly, the urban mahalla kengashes of mahalla types which were shaped according to identity politics during the Soviet era could be easily adapted the new regime shifting from class to identity politics / whereas other mahalla types shaped according to class politics of the Soviet regime has fall in difficult situation. Finally, the decentralization policy and hegemonic projects of the regime have been shaped by the dialectic relationship between the state and mahalla kengash. Thus this relationship can be both spatio-temporally and socio-spatially differentiated.Consequently, it has argued that standard theoretical paradigms for understanding transition in post-Soviet local politics are less globally generalizable than previously thought.