From the mid-1980s to mid-1990s, the issue of the role of institutions in international politics generated more debate than any other issue in IR. This chapter highlights the impact of this debate on realism. More specifically, it illustrates how the debate urged realism’s bifurcation into two opposing postures on the role of international institutions. In this sense, the chapter tells the “tale of two realisms.” The first section is about the first tale. It examines the so-called “neo-neo debate” between the neorealist Joseph Grieco and neoliberal institutionalists, led by Robert Keohane. In this debate, Grieco and various other neorealists adopted many of the key tenets of neoliberal-institutionalism, which generally postulates that under certain conditions, institutions do enhance cooperation among states. The second section articulates the key features of another debate on the role and efficacy of institutions, which had occurred between John Mearsheimer and a host of IR scholars, including realists. This debate both helped to clarify the contours of Mearsheimer’s “hyper-realism,” which basically postulates the impotency of institutions, and gave vent to the growing frustration with realism a la Mearsheimer. The approaches of Grieco and Mearsheimer are seen as imprecise and limited representatives of the broader diversity of realist takes on the role of international instituions. Another noteworthy aspect of this debate was the articulation of numerous non-realist approaches.