In this chapter, published as part of the Routledge Handbook of Differentiation in the European Union, we discuss and advance three central claims about differentiation in the security and defence policy of the European Union (EU). First, we argue that differentiation in EU security and defence is best characterised as a phenomenon of differentiated cooperation, owing to the lack of true integration in this domain which remains a core prerogative of EU member states. Second, we suggest that the mechanisms of differentiated cooperation at work in the EU security and defence policy can be usefully divided into two broad categories: those that allow for negative differentiated cooperation and those that allow for positive differentiated cooperation – i.e. opt-outs and opt-ins. Third, we argue that the emergence of these mechanisms at particular points in time has been driven by changes in the EU’s security environment which have shaped member state perceptions of the roles of the North Atlantic Treaty Organisation and the EU should play as frameworks for security and defence cooperation in Europe.