This article analyzes how childcare vouchers were introduced in the context of the Swedish welfare state by examining vital political decisions from the prohibition of publicly funded private preschools in 1984 and onwards. Basing our argument on theories of political institutions and historical institutionalism, we argue that this remarkable shift in preschool policy was due to a set of specific historical premises that included an expanding preschool sector and incremental reforms that did not abolish public preschools, but merely complemented them with private preschools. Instead of perceiving childcare vouchers as the mere results of marketization ideology, we interpret this reform as the result of a sequence of decisions, institutional layering, vested interests, and positive feedback mechanisms, where the expansion of the early care and education sector played a significant role. In this context, we argue that the marketization may be seen as a successful support of the rapidly growing sector of publicly funded preschools in Sweden. Although the Social Democrats lost the battle of marketization, they certainly won the war on publicly funded preschools for all.