The literatures on democracy promotion (Carothers and Ottaway 2005; Anderson 2006; Finkel, Pérex-Liñan and Seligson 2007) and peacebuilding (Call and Cook 2003; Posner 2004; Uvin 2006) see civil society as a fertile terrain to achieve democracy and sustainable peace. A strong and vibrant civil society is a credible bulwark against state authoritarianism (Burnell and Calvert 2004; Hawthorne 2004); it also underpins societal reconciliation and peacebuilding (Kassis 2001). Civil society is a locus of donor-led democratisation and peacebuilding efforts but we know relatively little about the conditions under which it actually fulfills these expectations. Lebanon provides a good case to investigate these conditions. Historically, its vibrant civil society (Salem 1999) has been ‘colonized’ by communally-organized logics, resulting in a strong communal mujtama’a ahli versus a weak mujtama’a madani (Traboulsi 2004). Civil society actors that tried to cross-cut sectarian lines often lacked of a strong enough sense of common purpose or common cultural frames of reference to bring –and keep– them together (Kingston 2007). Recent events in Lebanon have triggered the rise of “claims-based” NGOs (Karam 2005) that share the explicit or implicit goal of challenging the sectarian-based system. They ignited new hope of building bridges across sectarian lines to build a more democratic future. Several received considerable foreign aid. A few short years later, many are closed, defunct or inactive. Why have these efforts faltered despite donor support and a public that seemed ready for political change (Baladi, Sparks 2007)? Previous studies examined the internal challenges that these NGOs have confronted (Kingston 2007). Few questioned their commitment to the end of a sectarian-based political system. To our knowledge, none investigated the role of the state and donors in strengthening or weakening the prospects of these NGOs. Based on fieldwork conducted in 2007 and 2008, we ask: why have these organizations failed to meet expectations as to their role in democracy promotion and peacebuilding? In answering this question, the paper will look at: 1) NGOs’ relationship to sectarianism; 2) their relationship to the state; and 3) their relationship to donors. Taken together, these factors allow us to develop a typology of civil society organizations, highlighting the diversity inherent in their structures, strategies and objectives. They allow us to refine the expectations of the democracy promotion and peace building literatures, identifying the kinds of civil society organizations most likely to have transformative potential and thus opening new lines of empirical inquiry.