The policy problem of Vocational Education and Training (VET) development is an ongoing challenge for many developing countries. International organisations and donor agencies conceptualise the problem as one of skill supply and demand mismatch. Such a market-based perspective offers important insights into the problem; however, it does not sufficiently emphasise the influence of the historically institutionalised systems in which key VET actors, such as the state, employers and workers, are embedded. In this article, we use evidence from the Egyptian context to explore some of the key institutional features that have historically influenced VET and its trajectory to development. We use a process tracing approach to analyse documents on VET development in Egypt from 1955 to 2011. The analysis shows the persistence of weak VET and weakly articulated state-employer-worker relations across three temporal phases identified by critical junctures during this period. The study calls for a broader conceptualisation of the VET development problem to account for the historically rooted institutional relationships between the state, capital and labour in Egypt.