Abstract This article analyses how states adapt generic policies to the increasing diversity that characterises contemporary European societies. More particularly, it zooms in on how migration-related diversity is mainstreamed into education policies in the Netherlands and Flanders and why we observe different policy trends in these two cases. We find that the focus on migration-related diversity largely faded in Dutch education policies in the period from 2000 to 2014. In Flanders, this trend towards ‘migration-related diversity retrenchment’ is less prevalent during this period, even though a similar evolution has started to take place more recently. These findings present a puzzle, as the most evident explanation for diversity retrenchment, namely the increasing politicisation of migration and diversity, cannot account for this difference since the Netherlands and Flanders are characterised by similar degrees of politicisation of migration-related diversity. Our findings thus call for an exploration of underemphasised explanations for diversity retrenchment. We show that the diverging degree of diversity retrenchment can be explained by the presence or absence of a sub-state nationalist project and diverging degrees of neoliberal retrenchment policies. Sub-state nationalism seems to have temporarily offered a buffer against the neoliberal retrenchment of migration-related diversity.