This report analyzes the political dimensions of Iraqi displacement, beginning with a short description of the present situation and its historical background. It then analyzes the implications of the large-scale internal displacement on the security of both Iraq and its two neighbors who host the largest number of Iraqi refugees. A discussion of U.S. policy, European concerns, and the response of the United Nations is followed by analysis of returns of the displaced, with particular attention to the burning issue of property compensation. The study concludes with recommendations to the U.S. government and to the broader international community.