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Using the logic of a two-phase cooperation framework (first bargaining to reach an agreement, then enforcement of the negotiated agreement), this article examines how the risk of institutional breakdown can help promote international cooperation. I argue first that the risk of institutional breakdown can help promote bargaining cooperation by raising the opportunity costs of bargaining failure, thus providing a strong incentive for states who value the fragile international institution to negotiate a cooperative agreement. Having helped states to reach a cooperative bargain, the risk of institutional breakdown can also play a role in the subsequent enforcement phase. I argue second that the risk of valued institutional breakdown can reduce state preferences for defection, moving the enforcement problem away from the standard Prisoners' Dilemma structure. To illustrate these arguments, I examine the European Community's decision to recognize the breakaway Yugoslav republics of Croatia and Slovenia. [ABSTRACT FROM AUTHOR]