Since December 2010, events in Tunisia have influenced politics across the Arab world. The overthrow of long-ruling autocrat Zine El-Abidine Ben Ali inspired similar demands for revolution throughout the region. The drafting of a democratic constitution and free, competitive elections for parliament and president demonstrate the liberalizing possibilities for other Arab states. However, the winds of political change haven’t only blown eastward from Tunis. This paper investigates the impact of regional variables on political developments in Tunisia since 2011, with a focus on the transnational role of Islamism. Drawing on the regional systems literature, we argue that the permeability of Arab states to ideological debates, security challenges, resource flows, and contestation over the role of Islamism across the Arab world have contributed to the particular contours of Tunisia’s ongoing political transition. The paper analyzes several milestones in Tunisian democratization: the election of the Constituent Assembly in 2011, the drafting and vote for the new constitution, and the parliamentary and presidential elections of 2014. Local issues, including employment, national historical context, and individual political personalities, are necessary, but not sufficient, to explain the electoral and constitutional outcomes. Only by incorporating the effects of transnational variables, especially the vacillating fortunes of Islamist movements and the attendant issues of security and resource flows across the Arab regional system, can a full picture of Tunisia’s transition be gained. Research for this paper includes the use of public opinion surveys, campaign literature, and personal interviews with politicians, journalists and academics to analyze the lines of causation in Tunisia’s constitutional and electoral outcomes. We find that the permeability of the Arab regional system creates varying constraints and opportunities for Tunisian political actors, and influences citizens’ views on party competition, democratic values, and public policy. This study seeks to contribute to the literature emphasizing the interrelationship of domestic politics and foreign policy in the Arab world by investigating the causal effects of transnational variables on democratic institution building.