The division of power in the state is not limited to maintaining the separation of powers in a horizontal sense. In every country, regardless of its form, there is a need to protect the autonomy of local authorities against interference from the central government (the vertical aspect of the division of powers). The scope of this autonomy is derived from the form of the state and is wider in a federal state than in a unitary state. Good faith is therefore applicable both where power is decentralised and in a state where federal entities partially exercise sovereign power (federal states, unitary states). It is also important in relations between units of decentralised power. Good faith in the abovementioned vertical relationships is a mutual obligation which has its source in the provisions of the state constitution. This obligation is understood in terms of cooperation and loyalty. Its function is to facilitate effective and legitimate authority by prohibiting the arbitrary exercise of power at the central level and the arbitrary threat to, and undermining of, confidence in legitimate central authority by local (regional) authorities. Therefore, the question arises whether the public law vertical dimension of the idea of good faith is gaining recognition in national legal systems and what its manifestations are. The examples of Spain and Germany show that the principle of loyalty is applied in constitutional law, and examples from practice confirm its importance for the stability of power in the state. In contrast, US law does not recognise such a principle, probably because the structures of state and federal governments are much more distinct. The mere expectation of mutual loyalty between the authorities from a vertical perspective may turn out to be insufficient. Therefore, the constitution provides for mechanisms for the judicial resolution of competence disputes, including those concerning the scope of autonomy of local (regional) authorities. The assessment of these mechanisms depends on many factors, in particular the legitimacy of the entities initiating these proceedings, the level and manner of shaping procedural guarantees, and the effectiveness of court decisions and their legal and financial consequences. The thesis that cooperation and loyalty may determine the direction in resolving manner of resolving competence disputes that arise in practice seems justified.