This article aims to identify the character of the cultural transformation and psychological adaptation of European peoples in the twentieth century through observing and scrutinising the interactions between cultural forces of integration and disintegration in Europe. Under the distressing circumstances of World War I, ”modernity” was on several levels negated, traditional values and beliefs were distrusted in Europe. Oswald Spengler labelled this phenomenon ”the decline of the west”. Yet, appealing to shared historical background, common cultural (spiritual and material) heritage, trans-European social and integration movements, and the enormous forces of post- modern currents, (namely, thoughts of decentralization, decolonizaiton, and multi-culturalism), in replacement of conflict, contemporary European peoples seem gradually to have learnt to co-exist or even cooperate amongst themselves with increasing intelligence and enthusiasm. On the general global resurgence of the world's major civilizations, Europeans are now conscious that it is time to counteract the deep rooted racism, nationalism, xenophobia, secessionism, as well as ideology of ethnocentrism and Eurocentrism. Such matters and tendencies are now at the centre of the world's attention. Whether the creation of a ”Community of European Cultures” as proposed by the European Union will substantially lead this newly self-centered Europe onto the way of a continent with cultural diversity is now a matter of serious concern.