Reiter addresses a striking empirical puzzle: Why, in this century, have some small powers chosen to enter alliances when faced with international instability whereas others have stayed neutral? Specifically, why did Belgium, the Netherlands, and Norway join NATO, while Sweden, Switzerland, and Ireland did not? Employing quantitative and case study methods, Reiter finds that peacetime decisions about alliance and neutrality stem from states' experiences during world wars. Tested against balance-of-threat theory, the leading realist explanation of alliance behavior, Reiter's formative-events model of learning emerges as a far better predictor of states' decisions. Crucible of Beliefs' findings show that, contrary to balance-of-threat theory, state leaders ignore the level of international threat and focus instead on avoiding past mistakes and repeating past successes. A serious blow to realism, these findings demonstrate that to understand the dynamics of world politics, it is essential to know how leaders learn from history.