In April 2019, the Japanese government officially legally recognized the Ainu as Indigenous people. Building on an institutionalist framework, the paper suggests that a phenomenon of institutional layering has taken place, resulting in tensions between the desire to preserve the legitimacy of old institutions and the pressure to develop more progressive policies. To explain this process, policy legacies, and institutional opportunities are relevant. First, the narrative that equality can be attained through assimilation, and the political construction of the “Ainu problem” as a regional one tied to Hokkaido pervade political imaginaries and institutions. Second, institutional opportunities have mediated the ways activists have sought to make their voices heard in the political arena. A focus on key historical segments illuminates the difficulty for activists to penetrate high-level political arenas while indicating the importance of agency, ties and interests in explaining major reforms and their limitations. The ambiguity that characterizes current policy framework points to the potential leverage that this policy configuration represents for the Ainu. At the same time, historical and institutional legacies that have shaped Indigenous politics continue to constrain, to a great extent, the possibilities for meaningful and transformative developments for the Ainu.