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There has been considerable recent debate about prostitution in Europe that reflects concerns about health, employment and human rights. Legal changes are being introduced in many countries. We focus on two examples in order to discuss the likely implications. A new law in The Netherlands is normalizing aspects of the sex industry through decriminalizing both workers and businesses. In Sweden, on the other hand, prostitution is considered to be a social problem, and a new law criminalizes the purchasers of sexual services in an attempt to reduce demand. Both reforms appear to have had their desired effect at one level; in The Netherlands, health and safety regulations will be introduced as in any other job, and EU sex workers gain full social, legal and employment rights; in Sweden there was initially a tenfold decrease in the numbers of women working visibly on the streets, and some workers have left the industry. However, in both countries, the new legislation has also driven some sex work underground. Many sex workers are excluded by the Dutch system and move underground to become effectively invisible to the authorities. In Sweden sex workers and their clients also become less visible in order that the latter can avoid sanction. Social and economic changes, such as increased migration and the growing use of the Internet will also render the sex industry less visible both to state regulation and to health care workers. The major problems of prostitution for the workers remain exploitation, stigma, abuse and criminalization. These are not unique to the industry, and can only be tackled effectively by the self-organization of sex workers into unions and rights groups, along with full decriminalization. An alternative vision is promised through self-organization and anti-racist actions by sex workers in Germany; normalization and workers' rights are tackled alongside training programmes for those seeking alternatives. Policy makers throughout Europe would do well to look at their experience and not simply at the clash of legal reforms.