Scholars have often dismissed the effect of war on state formation in regions like Latin America where mobilization for war is deemed insufficiently intense and international conflict fails to out-select weaker states. Against this conventional wisdom, this dissertation contends wars can affect state building trajectories in a post-war period through the different state institutions that result from victory and defeat. The dissertation is divided in four parts. In a first part, it reconsiders the role played by war outcomes in classical bellicist theory and explores the concepts of war and state capacity in nineteenth-century Europe and Latin America. In a second part, it develops a multi-method strategy to test this claim by combining qualitative comparative analyses of state capacity at the year 1900 with difference-in-differences analyses and the synthetic control method, two estimators that identify the effect of losing vis-à-vis winning a war on levels of state capacity in a panel of Latin America (1865-1913). In a third part, causal mechanisms are illustrated in case studies of the Paraguayan War (1864-1870) and the War of the Pacific (1879-1883). Finally, a fourth part explores generalization to other Latin American cases and beyond.