Groups competing with the state, from insurgents to criminal organizations, are widely believed to emerge in weak states unable to provide protection to their citizens. This dissertation considers a common but less investigated phenomenon: criminal groups often expand to states with strong economies and institutions. How do they manage to expand? Which policies can states adopt to fight against them? My first paper proposes a theory of expansion. I argue that criminal organizations expand by striking agreements with political and economic actors facing competition and to which they can offer critical resources to gain an edge over competitors. I test two predictions of the theory in the context of move of Southern-Italian mafias to the North. First, I show that increases in market competition (due to a construction boom) and in mafias’ capacity to offer cheap illegal labor (by exploiting migrants from mafia-controlled areas in the south) allowed criminal groups to expand. Second, I find that parties in agreements with criminals gained a persistent electoral advantage in mafia-infiltrated cities. This chapter suggests that criminal groups leveraged fragile categories and deals with political and economic actors in strong states to expand. In my second paper, I show that a similar strategy allows them to thrive. I study the effects of a campaign providing migrants in agriculture with the tools to denounce labor exploitation. I find that the campaign increased both police reporting of exploitation and prosecution of criminal organizations, often responsible for smuggling and controlling migrants. This suggests that fighting migrants' exploitation directly damages criminal groups. My third paper studies another non-violent method to fight organized crime: targeting their revenues. We study an Italian policy fighting mafia-misappropriation of public funds and find that criminals strategically react by displacing their activity where the policy does not enforce investigations, underscoring the importance to design anti-mafia policies that anticipate criminal groups' sophistication. My dissertation highlights the need to re-conceptualize criminal organizations not only as substitutes for weak states, but also as complements to states with strong institutions and considers policies to fight them based on understanding the strategies they use to persist in strong states.