The European Union Police Mission (EUPM) in Bosnia and Herzegovina (BiH) represents a watershed development for the EU and its emerging European Security and Defence Policy (ESDP). Never before has the EU organised and managed this type of stabilisation programme. In some ways, the launching of EUPM defined a new stage in the evolution of the EU itself, and certainly of the ESDP. An examination of the implementation of the EUPM in 2003-2006, and the current planning for an EU mission in Kosovo, suggests that a process of institutional change and learning has occurred among EU and national officials. At the same time, it is apparent that significant improvements are still necessary in the coordination between and within EU pillars as they relate to ESDP operations. To that end, this study focuses on five important areas of challenges revealed by EU field operations in BiH: mission mandates; personnel expertise, recruitment and training; program design, implementation and assessment; reporting and decision-making procedures and structures; and the functions of EU representatives in the field (EU Special Representatives, Commission Head of Missions and Member States). Lastly, it also suggests means to materially improve EU crisis response, paying special attention to lessons learned during the first EUPM and from EU efforts to address organised crime in BiH.