||This paper explores the meaning, and some of the practical implications, or health sector reform in less developed countries. It reviews the problems that reforms have to address, and the policy objectives they are designed to achieve. It argues that the process of reform is not concerned only with defining priorities and refining policiies, but also with reforming an drestructuring the institutions through which health policiies are implemented. Even though some organizational principles are likely to be common to all reform programmes, a prescriptive approach to institutional reform is inappropriate. The choice of reform options can be influenced by technical advice and analysis, but the decision to proceed, and the subsequent success of implementation, will be dependent on political support. The latter part of the paper presents examples of institutional reform from several less developed countries and includes a consideration of the role and influence of donor agencies.