An inhabited institutions perspective views institutions from the bottom up, as “inhabited” by individual and organizational actors who have agency, rather than as static, top-down structures. Criminal justice structures and policies, such as those that govern courts and their sentencing decisions, are dependent on court participants. From this perspective, several conclusions emerge. First, theory and methods in the study of courts and sentencing are out of balance: theories emphasize interpretation, culture, and processes, while empirical inquiries focus largely on statistical studies of aggregates and outcomes. Second, the inhabited institutions perspective blurs the lines between the discretions of specific participants such as prosecutors and judges. Rather than attempt to parse the discretion of individual actors, we should study the interactions that jointly produce discretionary decisions. Third, we should focus on specific organizational mechanisms that produce both uniformity and variation between courts. Finally, variation between courts in sentencing practices should be understood not as a nuisance in top-down imposition of sentencing policies, but as a valuable but underappreciated source of policy feedback and learning.