The paper compares the institutional development of skills formation in Lithuania and Ukraine by focusing on the implications of the post-communist transition and Europeanization and exploring the role of policy transfer. The research follows the theoretical approach of historical institutionalism and skills formation ecosystems. Despite similar critical junctures typical for the institutional development of skills formation in Lithuania and Ukraine within this timeframe, the existing differences of these development pathways can be explained by the different policy choices and different impacts of the institutional legacy. The main implication of integration with the EU for skills formation in Lithuania and Ukraine is related with enabling holistic and strategic institutional development of skills formation institutions. The paper concludes that policy transfer was one of the key driving forces and capacity-building sources in the development of skills formation institutions in both countries.