Central European agricultural land ownership is fragmented. An instrument that is particularly suited for solving the land fragmentation problem is land banking. Although the potential of land banking is acknowledged, details on the actual use prove to be hard to fill in. In Western Europe, a long-standing tradition on land banking provides insight into these questions and the options that are at hand. This article elaborates on the role of privatisation in the emergence of land fragmentation in Central Europe, the question whether it must qualified as being negative and what choices fragmentation poses to governmental intervention. With this description in mind, the basic principle of land banking is described, as well as land banking initiatives in Central Europe and past experience from Western Europe. From this empirical description, a number of operational issues are derived that demand political choices. The article concludes with a discussion on the challenge of Central European land fragmentation. (c) 2004 Elsevier Ltd. All rights reserved.