The paper outlines the foundations of the "Nordic balance" as a Scandinavian neutrality zone in the bi-polar Europe during the Cold War. The co-operation in regional "security community", as perceived by Karl Deutsch shares certain common feelings and practices closely related to the orientation of peaceful change. Such "community" was created as both effective and natural, and this process was not imposed through a formal framework of supranational institutions. However, after the events of 1989-91 the Nordic balance was destroyed while the security community was preserved. These events transformed the North European security situation creating two pillars of "parallel action", one consisting of Denmark, Sweden and Finland, and the other of Estonia, Latvia, and Lithuania.