The threat posed by organized crime is not confined to serious crimes such as racketeering, the global drug trade, or human trafficking. For many developing countries and fragile states, powerful transnational criminal networks constitute a direct threat to the state itself, not through open confrontation but by penetrating state institutions through bribery and corruption and by subverting or undermining them from within. This paper examines whether Kenya faces such a threat. Six categories of transnational organized crime are examined, pointing to significant increases in criminal activity with pervasive impacts on government institutions in Kenya. Rampant corruption in the police, judiciary, and other state institutions has facilitated criminal networks’ penetration of political institutions.