This paper aims to provide an analysis of the mechanisms of the war economy in Liberia, examining the linkages between factional activity and the political process at government level, as well as the ways in which micro-level survival strategies feed into the illegal economy. Through such analysis it is possible to highlight the various policy strategies that may help to limit or counter the effects of the political economy that has developed. These may challenge the orthodox role of humanitarian relief, but radical solutions are necessary because of the nature of the prolonged crisis in Liberia.