Nigeria’s ongoing decentralization offers states increased autonomy, yet success depends on moving beyond federal allocations toward institutional innovation. Rather than merely cloning policies from other regions, states must adopt a laboratory model of governance—testing, measuring, and refining solutions for local services like electricity, healthcare, and waste management. Achieving meaningful progress requires states to prioritize institutional capacity, accountability, and cross-state cooperation over political patronage and federal dependency. Improving subnational performance is essential for a functional federation.