Renewed interest in theorizing about the process of European integration is reflected in recent scholarship on the political evolution of the European Union (EU). Meanwhile, a rich and growing literature has emerged on EU policy-making in specific policy sectors. Yet the gap remains wide between theoretical models which seek to explain broad patterns of European integration and those which seek to explain the EU's policy-making process. This article conceptualizes 'policy networks' as a tool for analysing EU policy-making. Its central argument is that the EU is a 'hothouse' for different types of policy network, for two reasons. First, the EU lacks 'off-the-shelf institutions which can facilitate informal bargaining between different types of actor. Secondly, decisions taken at the policy formulation stage have become important determinants of eventual EU policy outcomes in recent years. The policy networks model is placed within a broader theoretical framework for studying decision-making in the European Union at different levels of analysis.