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Local politics in Spain has triggered iconic shifts over the last few years, and the electoral success of new ‘movement parties’ in particular has dramatically challenged the political establishment. Between 2015 and 2019, many municipalities – including, crucially, the two biggest cities, Madrid and Barcelona – were governed by coalitions originating from anti-austerity, anti-eviction and pro-democracy struggles. This has significantly affected hegemonic and widely normalised discourses supporting the neoliberalisation of urban politics, and to some extent has also prompted novel governance approaches. Based on empirical research undertaken with local councillors, officials, consultants and activists, the article develops an in-depth analysis of governance transformations in the Spanish capital of Madrid. By doing so, it evaluates the ambiguities and contradictions that the government coalition Ahora Madrid was facing during the 2015–2019 legislative term. The debate stimulates critical reflections for academics, practitioners and movements on the transformative capacities that new municipalisms may enact, as well as the constraints faced by established multi-level urban governance regimes.