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Abstract Why have national governments of EU member states created and, over the past fifty years, successively endowed the European Parliament with supervisory, budgetary, and legislative powers? This book presents a three-staged argument to explain how the European Parliament acquired this power ‘trias’. First, it is argued that the construction of a supranational polity induces political elites in the member states to reflect on the implications posed by transfers of national sovereignty for domestic processes of democratic accountability and interest representation. It is shown empirically that there exists a strong correlation between national governments’ decisions to transfer sovereignty and political elites’ perception of a ‘democratic legitimacy deficit’ that triggers a search for institutional solutions for its remedy. In a second step, it is argued that political elites, first and foremost, domestic political parties, advance different proposals to alleviate the perceived ‘legitimacy deficit’. These proposals are derived from ‘legitimating beliefs’ that vary cross-nationally and across political parties. Consequently, the creation and empowerment of a supranational parliamentary institution plays a prominent but not exclusive role as potential remedy to the ‘democratic legitimacy deficit’. Third, the book illuminates the mechanisms through which ‘legitimating beliefs’ expressed by political elites and the behaviour of national governments who negotiate and decide on the creation and potential empowerment of the European Parliament are linked. What logic of action best captures national governments’ decisions to empower the European Parliament? The explanatory power of the theoretical argument will be explored by looking at three landmark cases in the European Parliament’s history: its creation as ‘Common Assembly’ of the ECSC Treaty and the concomitant acquisition of supervisory powers vis-à-vis the High Authority, the acquisition of budgetary powers (Treaty of Luxembourg of 1970) and of legislative powers (Single European Act signed in 1986). The developments ranging from the Maastricht Treaty to the adoption of the Treaty establishing a Constitution for Europe will also be analysed in the light of the theory.