This study offers a comparative explanation for recent changes in the structure of the party system and its ideological configuration in Japan. Its basic argument is that party failure and conservative convergence of party ideologies, which can be found in most post-industrial societies, have changed the party environment in Japan so that factional and partisan struggles over revision of the electoral system might have developed into a transformation of the party system. Past studies of the Japanese party system, preoccupied with explaining the success of the LDP government, underestimated possibilities of its fall. Many Japanese people have long found it difficult to choose a party to support between the corrupt and complacent LDP and the ineffective opposition parties dominated by special interest groups. Popular distrust and disaffection toward the parties were irrecoverably exacerbated, not merely by the "Recruit" and other corruption scandals but by the lack of sincere efforts by party leaders for political reforms including electoral reform. The other factor that contributed to bringing about an era of coalition government is the ideological convergence of the parties toward conservatism. Influenced by the economic recession within and the demise of communist countries without, ideologies of progressive parties, in particular that of the JSP, have become conservatized enough to take part in a coalition government led by conservatives. Due to the failure of existing parties and their lack of ideological differences, young conservative MP" s expected a new party to provide better reelection chances and a greater share of offices. Old opposition parties such as the KMT and the DSP would not but go along with the new parties in forming together a coalition party, the NFP, without which they could not have survived under a new electoral system. The party system will remain fluid as the parties need a couple of elections to get adjusted, and frequent transfer of power may not be ruled out. Government policies will not change, however, since the coalition government will be led by either of the two conservative parties.