<p>States exercise their sovereign power by determining who is permitted to enter and remain within their territory and who is not. This is achieved through complex sorting, selection, and categorisation processes, as seen in migration legislation. This article examines recent developments in the legal categorisation processes of border and migration institutions, using the German Deportation Suspension (Duldung) state institution as a paradigm case. Through micro- and categorisation analyses of legal texts, related parliamentary hearings, and interviews with legal experts and practitioners, the article sheds light on how current migration legislation perpetuates ambiguous, differentiated, and liminal border spaces. It argues that increasingly detailed legal provisions and the quantification of categories, integrated with more detailed and differentiated rules, do not provide the desired clarity. Furthermore, migration legislation contains numerous exceptions to categorisation rules. Categorisation work is therefore inseparable from exception work. In the case of the institution “Duldung”, exceptions not only are constitutional but also form the basis of its legal existence. These findings contribute to ongoing debates about border and migration governance by providing empirical evidence that the production of (il)legalisation is the result of ongoing ambivalent and contested categorisation work intertwined with the normalisation of exceptions. Methods of this kind are neither confined to legal frameworks nor unique to the German context but rather form part of a wider array of mechanisms and tools in migration and border governance.</p>