Under the Labour governments of 1997-2010, UK economic immigration policy was transformed from one of the most restrictive to one of the most liberal in Europe. This development was especially puzzling given the noted path dependence of immigration policy, as well as the absence of any public demand for liberalisation. In this article we explain immigration policy liberalisation under Labour using the concept of a 'critical juncture': a short window of opportunity in which structural influences on political action are relaxed. Based on over 50 elite interviews, the article argues that during Labour's second term in office (2001-2005) three factors combined to cause policy liberalisation: a strong economy with labour and skills shortages; a government ideologically committed to globalisation; and institutional reforms to the policymaking machinery that introduced new actors, both governmental and non-governmental, into the immigration policy field. While none of these factors would have been sufficient on their own, together they were sufficient combined causes for immigration policy change.