The assignment of functions to sub-national governments has been an important issue in both federal and unitary states. Indonesia, a unitary state, has recently addressed this issue in the context of its district autonomy pilot program, providing an opportune window to empirical research. The findings of this research indicate that the dominant criteria model does not guide actual decentralization practice, but rather tends to be used to maintain political and bureaucratic power. The closed pattern of communication surrounding the design of decentralization initiatives, the actual pattern of transferred functions, and the undermining of decentralization implementation efforts reveals a dynamic arena where prominent central agencies, and to a lesser degree the provinces, struggle to maintain their share of power and the resource flows that power commands, leaving little scope for genuine second tier region (district and cities) autonomy. Seen in social and historical context, decentralization in Indonesia is heavily circumscribed by a state that continues to exhibit patrimonial characteristics, where a self-serving and "'ad hoc'" bureaucracy's material interests works against decentralist sentiments and initiatives. The findings call into question whether functions transferred to the regions can be said to be "devolved". Central and provincial interests are likely to continue to dictate district development, with potentially adverse impacts on the sustainability of rural communities. The task of adjusting roles and responsibilities among Indonesia's levels of government requires that stakeholders engage in a more fundamental dialogue than has been the case, explicitly addressing neglected power and income related criteria, and addressing issues of political accountability to local constituents that also undermines the district's case for playing a larger role. Among other elements, this calls for a design and decision model that recognizes the different type of criteria that are brought to bear on decentralization decisions, and for a participatory communication style oriented toward reconciling diverse interests.