The international and comparative political economy literature has analysed intensively the financialization phenomenon, including the role of firms, of households, and of the state in these processes. Yet the literature retains a limited conceptual, empirical and normative understanding of the financialization of the state. This article deals with the financialization of the state itself in two areas: in the public management of the economy (e.g. infrastructure investment and public investment funds) and in the management of public debt. We measure state financialization along two dimensions, notably the reliance on financial markets as a governance mechanism and the adoption of a sense-making framework grounded in financial economics. Notwithstanding existing variation, we uncover a common trend of state financialization across European national political economies by adapting our concept to cross-national quantitative and qualitative data. Finally, this paper discusses the normative and empirical consequences of state financialization for the relationship between democracy and capitalism.