Vocational rehabilitation targeted to the socially disadvantaged long-term sick requires that the client keep in touch with a number of welfare state agencies, all of which have different regulations, conflicting goals and various types of benefits. This is an arduous and time-consuming task for clients with medical, social and labour market problems. Many of these clients run the risk of ending up in a no-man's land or being endlessly circulated between agencies because their problems do not correspond to the profile of the typical client. Both government and welfare workers see institutional co-operation between welfare state agencies as the remedy to such problems. This article, which is based on interviews with participants in fourteen cooperating projects, focuses on difficulties and opportunities experienced in such co-operation. It is concluded that such cooperation, when initiated in local settings and supported by local players, is a way of rejuvenating the existing Swedish model.