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Latin American municipal governments have recently increased in significance due to widely-adopted decentralisation policies. Institutional shifts have created ‘new political spaces’, or spaces for citizen participation distinct from both electoral democracy and non-governmental activism. One such space is the ‘System of Participatory Action’ (SPA), established in 2001 by the Municipality of Quito, the capital city of Ecuador. In theory at least, the SPA guarantees municipal accountability and offers citizens the opportunity to influence local policy through equitable participation in decision-making fora. As such, this space promises a decisive break with long-standing patterns of Ecuadorian political culture such as populism, corruption, and gender/ethnic discrimination. Does the SPA overcome these obstacles to deliver effective and responsive local government? This thesis ‘draws upon contemporary critical theory to evaluate critically the operations of the SPA between 200 and 2007. The work of Jürgen Habermas underpins a ‘Deliberative Quality Index’ (DQI), which is used to quantify levels of citizen participation in terms of ideals of ‘deliberation’ (reason-governed discussion). The impacts of SPA citizen participation upon local governance outcomes are measured using techniques including participant observation, interviews, and secondary literature analysis. This research agenda has yielded many insights concerning local governance in Quito. Specifically, while deliberative quality was generally high, several factors combined to limit the impact of deliberation on local governance outcomes. In substantive terms, less than 2% of Quito’s capital budget is distributed according to citizen preferences, a figure that compares poorly with many other new political spaces. Thus, while the SPA arguably constitutes a significant innovation in Ecuadorian citizen participation, this thesis concludes that its impact on local governance has been moderate at best.