As exemplified in the simultaneous presence of rising trends towards atomization, economic, political and cultural integration, the proliferation of nationalist movements, and the multiplication of identity-based demands, the early twenty-first century is marked by tensions between universalism and particularism. These tensions tend to result in a growing polarization of political and theoretical positions, most often expressed through a debate on citizenship. Between the discourses of homogenizing universalism, exclusive nationalism, and postmodern hyperfragmentation or atomization, little space is left for a balance between unity and diversity. In this context, despite the recent collapse of federations in central and eastern European countries, most of those who believe in the suitability and feasibility of a balance between unity and diversity still consider federations – or some other type of federal system – as one of the most valuable options (see Kymlicka 1998b; Smith 1995a; Forsyth 1994, pp. 22–3; Norman 1994; Taylor 1993a; Gagnon 1993a, pp. 21–31). By way of a comparative study of the evolution of federalism, federation and collective identities in Canada and Belgium since the 1960s, this chapter seeks to demonstrate both the high importance and the major difficulties of reaching a federal balance between unity and diversity in multinational and polyethnic countries. A balance between unity and diversity – within a single multinational and polyethnic country – may be defined as the institutionalization of both the plurality and the asymmetry of allegiances in compatible ways.