In federal states, immigration regulation is frequently shared with subnational levels of governance. In Canada, provinces even have immigration selection powers. This is significant, as an increasing proportion of new permanent residents (1) are now selected by a province, and (2) previously held a temporary residence permit. However, the ways in which the interaction between the federalization of immigration and two-step migration impacts migrants’ experiences is still not well understood. This article contributes to the literature by providing deeper insights into the effects of the federalization of immigration on migrants. Based on the case of Quebec, it analyzes how the federalization of two-step migration affects migrants’ transitions from temporary to permanent status, whereby immigrants become “included.” The article contends that rather than functioning as an administrative process of linear inclusion, the federalization of two-step migration produces an ambiguous process of inclusion which reflects contradictory federal-provincial political agendas and tensions.