This chapter deals with capacity development (CD), which has been a core issue in international development cooperation policies and practices for decades. The first section outlines what CD entails, why is it important and why at the same time it is so difficult to grasp. A distinction is made between capacity at the individual, organisational/institutional and societal level. The unequal relationship between donors and recipients, which has often led to unsatisfactory progress and results in CD, is briefly discussed.