By focusing on narratives of customs officers from Serbia and Bosnia and Herzegovina, I examine how technological and organizational change of customs work influences governance and sovereignty of the state and how customs officers produced a specific imaginary of the state through their narratives. Supporting the contention that the transnational flow of goods and people restructures rather than undermines the state power, the Serbian and Bosnian cases reveal how technological and organizational change of customs work opened up new arenas for an expression of state sovereignty and new modes of governance. Furthermore, I analyze narratives about unauthorized actions, or shady business as customs officers call it, as a mechanism through which “the state” is discursively constructed.