High levels of gender segregation in Scandinavian labour markets have been referred to as a paradox in view of these countries’ commitment to gender equality and advancements in other areas. The status of gender segregation in these welfare states is addressed here: Are they (still) the most gender segregated? What processes drive (de)segregation? Relatively fast occupational desegregation in recent years has moved Denmark, Norway and Sweden from the group of highly to moderately gender segregated labour markets, and women’s share of management positions is rising. Empirical case studies selected to shed light on (de)segregation processes are discussed in relation to two presently influential theoretical theses – ‘gender essentialism’ and the ‘welfare state paradox’. Findings suggest the existence of gender essentialist ideas, but the weakening of such ideas is likely to be a main driver of desegregation. Findings on the role of the public sector and work–family policy in segregation processes are somewhat conflicting.