The author intends to use the history of regulatory policy reforms in the United States of America as a framework for analyzing the different stages and political economy contexts of regulatory reforms within the domestic interstate commercial airlines industry. The author proposes three stages of regulatory reforms: regulation, deregulation and re-regulation. In each stage, there are different political and economical reasons and arguments for government to regulate or deregulate the domestic interstate commercial airlines industry. This article shows the U. S. government how to govern in the three stages. Since the 911 terrorist attacks, it changed the view and direction of <||>Reinventing Government<||> movement, this case study clarifies the role and regulatory reforms of U.S. government in the post deregulation era.