Turkey is undertaking comprehensive reforms in its healthcare sector which bring about a major transformation in the boundaries between the public and private sectors. As in many transition and late-developing countries reforms seek to universalize coverage, increase efficiency and improve quality of healthcare services. The Turkish case is interesting as it draws attention to the balance that is being struck between two major components of the reforms, namely marketization and universalism. Expansion of coverage and improvements in equity are taking place alongside state-induced market and managerial reforms. This article assesses the extent of marketization and argues that while market elements have been limited to the provision dimension, in the long run they may lead to some erosion in universalism. The Turkish case serves as an example of transformations in developing countries where market reforms have to be accompanied by a strong and active state for universalism to be achieved.