Trade disputes among competing countries have become increasingly common and contentious in recent years. They also receive a great deal of attention in the media. Indeed, they have taken on the character of minor battles between contending industries and countries with the trade actions called, variously, "provocations' or "threats' by one country against another. These trade skirmishes have acquired new significance over the last decade as the volume and relative importance of international trade and investment has grown. My purpose in this chapter is to examine and assess the workings of the trade dispute settlement institutions established under the trade liberalization agreement negotiated between Canada and the United States in 1987. These dispute settlement institutions have now been in operation for several years since the implementation of the Canada—United States Free Trade Agreement (FTA) in January 1989 and will be retained, although with significant modifications, under the North American Free Trade Agreement (NAFTA). My primary objective is to assess how well these institutions have served the two member countries under the FTA and how one might anticipate they will work under the NAFTA.