This chapter examines how Western sanctions affected the development of the Russian defense industry. The first section provides a broad overview of the role that the defense industry plays in the Russian economy. This is followed by an assessment of the nature of the defense industry’s relationship with the global economy in the second section. The nature of the sanctions imposed on the defense industry is then described. The fourth section examines how Russian government policies evolved in response to Western sanctions. The fifth section concludes by examining how the adaptive measures initiated by the Russian government since 2014 have moderated the impact of Western and Ukrainian sanctions. While Russia’s defense industry certainly experienced significant disruption as a result of Western and Ukrainian sanctions, the overall program of military modernization continued to proceed in a broadly positive fashion. Although the impact of reduced access to Western and Ukrainian components and defense-industrial equipment caused progress to slow in the procurement of surface ships for the navy and transport aircraft for the air force, the adaptive measures taken by Russian policymakers created the conditions for gaps in supply to be filled and reduced the industry’s vulnerability to sanctions in the future.