Contrary to popular perception, Japan’s Great Recession was not an uninterrupted period of economic decline. To place its history in better perspective, therefore, this study divides the two-decade long economic stagnation into five successive waves of recession. Based on the analysis of these past five waves, this study identifies policy challenges that Japan faces to break fully from its long-running Great Recession and get on the sustainable growth path. This study also takes note of additional challenges in the current round of economic recovery that mainly result from radical macroeconomic policies pursued in the current Abe administration.