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This study analyzes the territorial dispute between Bolivia and Chile. It aims to enhance our understanding of Bolivia-Chile relations and to explore the possible solutions for their territorial dispute. Special attention is paid to the negotiation of Charaña, which is considered to be the most important negotiation between the two countries in the 20th century regarding Bolivia’s access to the Pacific Ocean. After careful examination of the case, the authors argue the followings: 1) The ideological similarities between the governments in the two countries turned out to be a significant variable to determine the outcome of dispute resolution process. Historically, the probability of dispute resolution augmented when the governments of both sides shared similar ideology. i. e. the socialist government of Torres in Bolivia with the socialist government of Allende in Chile, the military government of Banzer in Bolivia with the military government of Pinochet in Chile, and the leftist government in Morales in Bolivia with the leftist government in Bachelet in Chile. 2) Peru plays an important role in the dispute resolution. As a participant in the War of the Pacific, Peru reaffirmed during the negotiation process of Charaña its rights written in the 1929 Treaty. 3) The negotiation of Charaña illustrates us the importance of neighboring countries and regional institutions on the territorial dispute resolution. In sum, this research sheds lights on political conditions for the possible resolution of the territorial dispute between Bolivia and Chile.