Rise of populism in Europe does not remain limited with voting rates of populist parties, though it stands out by means of both reflections of their proposed programs on government policies and the rise of Euroskepticism. This article investigates political system of the European Union and democratic deficit debates in this system as the roots of populist politics. During this investigation dynamics that the process of politicisation has induced is put forward within the framework of regional integration theories. In the light of neofunctionalism, intergovernmentalism and multi-level governance theories, it is concluded that not economic considerations but rather identity politics has gained importance in politicised European integration. Hence, identity politics form basis for populism through sovereignty and democratic deficit debates in the European Union.