This article analyzed the ambivalence of Indonesia’s state policies in recognizing local religions within a constitutionally pluralistic society. Although the constitution guarantees freedom of religion and belief, the practical implementation of related regulations reveals inconsistencies that marginalize adherents of local religions. Using a descriptive qualitative approach, this study mapped three forms of policy ambivalence, i.e., constitutional recognition versus administrative restriction, progressive regulation versus conservative bureaucracy, and diversity protection versus uniformity control. Data were collected through observations, interviews with adherents of local religions, and extensive analysis of legal documents and media reports. The findings demonstrated that normative recognition was weakened by bureaucratic practices that limit access to civil rights, education, ritual space, and public services. These inconsistencies placed local religious groups in a position of being “recognized yet constrained,” producing systemic discrimination through administrative categorization, supervisory mechanisms, and public order narratives. The article contributes to socio-legal scholarship by proposing a dialectical framework of “protection versus control” to explain how rights are negotiated within the legal-pluralistic context of Indonesia. It argues that substantive equality requires coherence in policy, accountable implementation, and strengthened bureaucratic capacity to ensure that recognition does not become an instrument of exclusion. The study concludes by urging future multimethod research to capture the diverse experiences of local religious communities in navigating state regulatory ambivalence.