Federalism shapes intergovernmental relations by creating a division of powers between national and state governments. This dual structure allows for cooperation and conflict as entities navigate overlapping responsibilities. Federalism promotes communication and coordination, yet can lead to disputes over authority and resources. Policies may differ significantly based on local priorities, impacting areas like education and healthcare. The relationship is dynamic, often influenced by political trends, economic conditions, and social movements, ultimately affecting how effectively governments function at both levels.