Community policy in aviation has been traditionally focused on state aid to airlines. Liberalization of air transport in the E.U. favoured privatization movements in airports and enhanced alliances between airlines. The emergence of low cost carriers alerted the community legislator to the new panorama of air transport in the E.U.: today, even public airports have to compete between themselves to attract new traffic. This paper offers a critical perspective of the current E.U. legal framework for publicly owned airports. 1. European Commynity State Aid Legal Regime 2. State Aid Policy in the Aviation Sector 3. State Aid Policy for Public Airports 4. International Public Air Law and E.U. Law 5. Summary, conclusions and recommendations: the need for reform.