The paper measures changes in environmental quality in transition countries from 1987 to 2000 because of economic growth and environmental reforms. Indication of property rights may accelerate the growth process, as well as the composition effect on the environment. Thus, we compare transition countries that are not yet members of the European Union offering poorly defined property rights with EU-member transition countries offering better-defined property rights. We find that although EU-member transition countries exhibit an inverted U-shaped relationship between pollution intensity and economic growth, with a turning point at $5,710, non EU-member transition countries do not support such a relation. © 2007 M.E. Sharpe, Inc. All rights reserved.