Variety of ethnic groups, different languages and cultural differences can cause conflicts and ethnic tensions in communities, but the emergence of an ethnic conflict depends on the government's approach in managing these diversity. One of the most important mechanisms for governments to manage ethnic diversity, language and cultural differences, is federalism. Federalism can be defined as decentralization and granting administrative autonomy to a Region in terms of geographic divisions. But federalism function to reduce ethnic conflicts, is not necessarily positive and can lead to deterioration in some cases. Accordingly, this study tries to analyze the impact of federalism on ethnic conflicts in Iraq. The research hypothesis is: through a process of creating bureaucratic structures, development of political parties and the recognition and acceptance of cultural differences, federalism can reduce sectarian violence and ethnic conflicts. The methodology of research is descriptive-explanatory.