This analysis of the Lithuanian health system reviews the developments in organization and governance, health financing, health-care provision, health reforms and health system performance since 2000.The Lithuanian health system is a mixed system, predominantly funded from the National Health Insurance Fund through a compulsory health insurance scheme, supplemented by substantial state contributions on behalf of the economically inactive population amounting to about half of its budget. Public financing of the health sector has gradually increased since 2004 to 5.2 per cent of GDP in 2010.Although the Lithuanian health system was tested by the recent economic crisis, Lithuanias counter-cyclical state health insurance contribution policies (ensuring coverage for the economically inactive population) helped the health system to weather the crisis, and Lithuania successfully used the crisis as a lever to reduce the prices of medicines.Yet the future impact of cuts in public health spending is a cause for concern. In addition, out-of-pocket payments remain high (in particular for pharmaceuticals) and could threaten health access for vulnerable groups.A number of challenges remain. The primary care system needs strengthening so that more patients are treated instead of being referred to a specialist, which will also require a change in attitude by patients. Transparency and accountability need to be increased in resource allocation, including financing of capital investment and in the payer provider relationship. Finally, population health,albeit improving, remains a concern, and major progress can be achieved by reducing the burden of amenable and preventable mortality.