The aim of this report is to explain the effect and the outcome of the Swedish-Finnish military cooperation and propose political courses of action to improve its deterrent qualities. It gives an extensive background on the defense policies in Sweden and Finland after the breakdown of the Soviet Union and the Treaty of Warsaw with a focus on the two countries reactions to Russian aggression in Georgia and the Ukraine. The report establishes that the cooperation is in fact a military alliance and analyzes the cooperation from a realistic perspective with elements based on social constructivism. Official documents, laws and legal documents are examined and an interview with a senior ranking Swedish military officer is made to provide the necessary factual base and input for the analysis. The analysis is performed with a view to both a short term and a long-term perspective. This report concludes that there is need for a binding treaty between the two countries concerning military assistance in case of an armed conflict with Russia. That there is urgent need especially for Sweden to increase defense spending. But also, that a military alliance between the two countries is a rational and politically sound idea. The cooperation should focus on mutual defense plans to increase military effectiveness, economic efficiency, and political resolve in the alliance.