The unprecedented number of newcomers in the past year provides an immense challenge to federal state and local authorities, who have to co-ordinate the provision of policies and funds for incorporating immigrants into society. This comparative study seeks to understand the role of federal states for the incorporation of immigrants in the context of the recent influx of asylum seekers in Germany and Austria in 2015. Few studies have so far investigated the role of federal states in immigrant incorporation and no research has yet been carried out on the character of federal state immigrant incorporation policies that captures institutional structures, officials and immigrant spokespersons’ agency as well as the role of power in the design and implementation of these policies. By bringing together debates on multi-level governance as well as cities as scale the research advances our concepts of the governance of immigrant incorporation in a globalised and interconnected world. Using mixed methods, the project applies an institutional ethnography of federal state ministries responsible for immigrant incorporation that allows tracing internal processes of policy development and observing interactions between the involved institutions and actors. The yielded thick description is combined with economic data as well as interview data and policy documents. By deploying a comparative research design that consists of case studies in four federal states (Baden Württemberg and Saxony, Upper Austria and Burgenland), two of which are located in Germany and two in Austria, the project identifies the impact of different factors on federal states’ immigrant incorporation policies, namely the national level’s stance towards immigration, the regions’ economic positionality, and local actors’ active lobbying on the federal state level.