This chapter explores why, despite being central players in transnational drug markets, Mexico and Peru’s post-authoritarian trajectories of peace and violence differ. It first examines how the Mexican military developed a powerful counterinsurgent state to fight leftist insurgents and dissidents under one-party rule. Once it succeeded in suppressing rebels through a Dirty War, authoritarian specialists in violence helped transform local traffickers into transnational drug cartels. After democratization, the first administration failed to adopt a transitional justice (TJ) process and subsequent governments deployed the surviving counterinsurgent state to fight a War on Drugs, leading to the proliferation of conflicts that turned Mexico into one of the world’s most violent democracies. Focusing then on Peru, the chapter traces the rise of the counterinsurgent state under military dictatorship, its expansion during the civil war, and its transformation under Alberto Fujimori’s dictatorship. After defeating the rebels, the head of Fujimori’s secret service seized control of transnational drug-trafficking. Following the collapse of dictatorship, the adoption of a robust truth commission and the prosecution of Fujimori’s security apparatus led to the dismantling of the counterinsurgent state, prevented the outbreak of large-scale drug wars, and set Peru on a twenty-year path of relative peace. However, failure to adopt TJ “boosters” opened a new era of violence.