Understood primarily as a meta-narrative reflecting citizens' reluctance to accept migration and Islam as permanent components of their society, grass-roots protests against mosque construction also highlight a democratic paradox regarding multi-level governance: while national governments bear chief responsibility for ensuring fundamental religious freedoms, local authorization procedures affecting mosque construction (e.g. zoning, building permits) have rendered communal spaces a Ground Zero for the regulation of Islamic faith communities. While similar protests have taken place across Europe, German officials face special problems in responding to challenges by neighbourhood groups, rooted in the complicated nature of federalism, the legacy of National Socialism and a new, if misunderstood, element of ‘militant democracy’ at local levels. The Pankow-Heinersdorf case, staged on the outskirts of eastern Berlin, shows that multifaceted interventions can help contesting parties come to terms with religious differences, develop their networking and dialogue skills and actually contribute to more effective democratic participation at the local level.