This paper provides an overview of the development and use of livelihoods approaches in relation to humanitarian responses in areas of chronic conflict and political instability. Current aid practice in situations of chronic conflict and political instability reveals a profound mismatch between the structures and institutions of the international aid regime, and the characteristics and dynamics within countries experiencing chronic conflict and political instability. The overview explores some of the issues that must be addressed in filling this gap between theory and practice. In applying a livelihoods approach to situations of chronic conflict and political instability, the paper emphasises the need to pay adequate attention to aspects relating to political economy.