The article focuses on the factors and mechanisms of European identity formation in the context of European integration. An overview of the public debate on identity formation is provided with special attention to the role of EU institutions and, in particular, of European citizenship in the emergence of a common identity. The content of European identity is analyzed on the basis of shared values and cultural characteristics and in correlation with other identity components important for the citizens of Europe, first of all with national identity. How far can identity construction go and how important are these issues for the future of the EU, for the common future of Europe and its citizens? By putting forward these questions the author draws attention to the crucial importance of identity factors in the development of a common polity at both nation-state and supranational (EC) levels.