This article will present Copenhagen’s tortuous path from industrial decline to regeneration city, focusing on the rebuilding of large waterfront areas in the Copenhagen Harbour such as Islands Brygge, Sluseholmen, and Frihavn, as well as on select developments in the central neighbourhoods Nørrebro, Vesterbro, and Christianshavn. It will show that Copenhagen’s “return to the inner city” was guided by the mutual influence of discourse, policy and architectural design. This is evidenced by government documents, press clippings and the comparison with other European cities. The article will also show that in contrast to regeneration projects elsewhere Copenhagen’s redevelopment yielded a comparatively socially mixed city with appealing public spaces and inventive architecture. This was facilitated by strong public authorities and by local and national politicians who upheld welfare state values and only to a small extent gave in to the market-oriented ideologies that influenced policy in other European countries at the time.