Stock exchanges will soon have to face a much more complex, demanding and competitive environment in the financial sector changing at a rapid pace. The main driving forces of this development will be the growing power of the fund managers of the large institutions managing the pension capital of the world, the continuing financial deregulation, and the widespread use of sophisticated technology. In such an environment, stock exchanges will initiate efforts towards privatization in order to strengthen their competitive powers and we will witness mergers of stock exchanges. As a pioneer in this respect, the Stockholm Stock Exchange provides a good example due to its high performance. The present article covers the development process of the Stockholm Stock Exchange and in particular, the privatization phase of it. The developments which led to the decision to privatize, the steps towards privatization and the results thereof are examined in this article in detail.