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This paper discusses the issue of regional convergence in Greece during the period 1995-2005. Following the theoretical concept of Barro and Salla-i-Martin, 1990 (ß- and c-convergence concepts), several tests are conducted to test for conditional or unconditional convergence across Greek regions including GMM estimation of Barro regressions. The results indicate absence of convergence across NUTS II regions while there is evidence of convergence at prefectural level (NUTS III). The effect of agriculture industry and services sector is examined and services are found to have significant impact on growth and convergence. Finally, we examine the effect of the implementation of the European funding programs in some detail. [ABSTRACT FROM AUTHOR]