An emerging feature of the modern regulatory state in Britain and elsewhere is the promotion of self-regulation. This paper examines the relationship between the state and self-regulation in the context of the challenge of meeting public interest objectives. It draws on research on the policy and practice of self-regulation in recent years in Britain. The paper argues that the institutions, processes and mechanisms of the modern regulatory state and the ‘better regulation’ agenda in Britain, notably those that aim to foster transparency and accountability, can assist in the achievement of public interest objectives in self-regulatory schemes. We conclude that a ‘new regulatory paradigm’ can be put forward which involves a form of regulatory ‘subsidiarity’, whereby the achievement of regulatory outcomes can be delegated downwards to the regulated organizations and self-regulatory bodies while being offset by increasing public regulatory oversight based on systems of accountability and transparency.