The two-state solution for the Cyprus dispute refers to the proposed permanent division of the island of Cyprus into a Turkish Cypriot State in the north and a Greek Cypriot State in the south, as opposed to the various proposals for reunification that have been suggested since the island was split into two by the 1974 Turkish invasion. The two-state solution would entail the legalisation of the status quo, where Greek Cypriots govern the southern part of the island and Turkish Cypriots govern the northern part, the latter of which is currently not recognised by any country other than Turkey.

Recognizing the Turkish Republic of Northern Cyprus as a separate state, as required by a two-state solution, has been firmly refused by both the United Nations and the European Union. This refusal is grounded in the principles of maintaining territorial integrity and sovereignty as per international law and UN resolutions. The European Union has stated that it will "never, ever" accept a two-state solution for Cyprus.

On 14 December 2019, Foreign Minister of Northern Cyprus Kudret Özersay said a two-state solution to the issue was "close to hand". On 23 February 2020, Ersin Tatar, who was then the prime minister of Northern Cyprus and was elected its president eight months later, said that "a forced marriage cannot be successful". He elaborated, "We are different, we speak Turkish and they speak Greek. We are Muslims and they are Christians. The new generation does not know each other at all. A child who was 10 in 1974 is now 55, he has grandchildren. We are separated."

ICJ's 2010-Kosovo decision and its reflections on the two-state solution United Nations' International Court of Justice decided in 2010 that "International law contains no prohibition on declarations of independence".

The International Court of Justice (ICJ)'s 2010 Kosovo decision, which stated that international law does not prohibit declarations of independence, does not translate to a similar acceptance in the Cyprus context. The ICJ clarified that the legality of such declarations often depends on whether they are associated with unlawful use of force or other egregious violations of international law.

The International Court of Justice (ICJ), without specifying whether it agrees or not with the determination of some of the relevant UNSC resolutions, declared in 2010 that

Oral Observations of Harold Hongju Koh on behalf of the United States of America, rejected the argument of the Cyprus against the "legality of the unilateral declaration of independence" of Kosovo: On 9 October 2014, United States District Judge Paul L. Friedman of the District Court for the District of Columbia qualified the TRNC as "democratic republic with a president, prime minister, legislature and judiciary".Courthouse News Center 13.10.2014 Property Spat Over Turk-Controlled Cyprus FailsUSA's Federal Court Michali Toumazou, Nicolas Kantzilaris and Maroulla Tompazou versus Republic of Turkey and Turkish Republic of Northern CyprusUSA's Federal Court Toumazou et al v. Republic of Turkey and Turkish Republic of Northern Cyprus

Judge Antônio Augusto Cançado Trindade made a statement in ICJ's Kosovo decision that

Relevant Court Cases International law contains no prohibition on declarations of independence,BBC The President of the International Court of Justice (ICJ) Hisashi Owada (2010): "International law contains no prohibition on declarations of independence." and the recognition of a country is a political issue.Oshisanya, An Almanac of Contemporary and Comperative Judicial Restatement, 2016 p.64: The ICJ maintained that ... the issue of recognition was apolitical.

UNSC Resolution 1983/541 is Non-Binding On 04.08.1986, Greece filed a case against the Council of the European Communities (supporter intervener:Commission of the European Communities). In the case, Greece first argued that the UN Security Council Resolution 1983/541 called "upon all States not to recognize any Cypriot State other than the Republic of Cyprus". Greece then reasoned that since the Turkish Government recognized the Turkish Republic of Northern Cyprus, the European Community "cannot grant it the special aid without ignoring that breach and thereby itself violating an obligation imposed on it under a measure which is binding on it by virtue of the principle of substitution."

On 25.05.1988, Council of the European Communities(supporter intervener:Commission of the European Communities) specified that the UN Security Council Resolution 1983/541 which is not passed under Article VII of the UN Charter is non-binding in nature, and Council of EC and the Commission of the EC stated that "It is manifest from the wording of the operative part and from the debates and the declarations of vote prior to the adoption of Resolution No 541 that the Resolution does not constitute a "decision" and is therefore not a binding measure, but a measure in the nature of a mere recommendation. Consequently, the States to which the declaration is addressed are NOT bound to comply with paragraph 7 of the resolution or to infer from the fact that paragraph 7 was not complied with the consequences which Greece claims they should infer."

On 27.09.1988, European Court of Justice (ECJ) rejected all of the Greece's arguments in the Case 204/86 (Greek Republic v. Council of the European Communities(supporter intervener:Commission of the European Communities)), and punished Greece to pay all the costs, including the costs of the intervener. ECJ stated (in prg28) that the Resolution 1983/541 of the United Nations Security Council is completely extraneous to relations between the Community and Turkey.

International Courts No prohibition of declarations of independence in international law: On 22 July 2010, The International Court of Justice (ICJ) stated in its advisory opinion on Kosovo's declaration of independence in 2010 that "the Security Council in an exceptional character attached illegality to the DOI of TRNC because it was, or would have been connected with the unlawful use of force" and "general international law contains no applicable prohibition of declarations of independence".

The ICJ's opinion was expected to bolster demands for recognition by Northern Cyprus. The decision of the ICJ has also been regarded as opening more potential options for the TRNC to gain international legitimacy. After the ICJ’s decision on Kosovo’s unilateral declaration of independence, the TRNC gained a huge advantage on the negotiation table and also an innovative Neo-Wilsonist path reopened in international arena. Can Kosovo be a sample for Northern Cyprus? According to international law, previous decisions are not become a precedent. But practically especially after the advisory opinion of ICJ in 2010, it surely will be inspirational way and another option for Cyprus and Cypriot Turks.

Legality of the acts of the TRNC's authorities: On 2 July 2013, The European Court of Human Rights (ECtHR) decided that "...notwithstanding the lack of international recognition of the regime in the northern area, a de facto recognition of its acts may be rendered necessary for practical purposes. Thus the adoption by the authorities of the "TRNC" of civil, administrative or criminal law measures, and their application or enforcement within that territory, may be regarded as having a legal basis in domestic law for the purposes of the Convention".ECtHR The decision of 02.07.2013. paragraph 29 The legality of the arrest of Greek Cypriots by the TRNC police; The legality of pre-trial detention and post-conviction imprisonment by the TRNC Authorities; The legality of the criminal proceedings conducted by the TRNC Courts: European Court of Human Rights (ECtHR) (23.02.2016; Application no. 11138/10; CASE OF MOZER v. The Republic of Moldova and Russia): "140. In several judgments concerning Turkey, the Court has applied the principles established in Cyprus v. Turkey to criminal matters (see Foka, cited above, § 83, where the arrest of the Greek-Cypriot applicant by a "TRNC" police officer was found to be lawful for the purpose of Article 5; Protopapa, cited above, § 60, where both the pre-trial detention and the detention after conviction imposed by the "TRNC" Authorities were considered to be lawful for the purpose of Article 5 and a criminal trial before a "TRNC" Court was found to be in accordance with Article 6; and also Asproftas v. Turkey, no. 16079/90, § 72, 27 May 2010; Petrakidou v. Turkey, no. 16081/90, § 71, 27 May 2010; and Union européenne des droits de l’homme and Josephides v. Turkey (dec.), no. 7116/10, § 9, 2 April 2013)."ECtHR The decision of 23.02.2016. paragraph 140 The legality, independence, and impartiality of the TRNC's courts: On 2 September 2015, The European Court of Human Rights (ECtHR) decided that "...the court system set up in the "TRNC" was to be considered to have been "established by law" with reference to the "constitutional and legal basis" on which it operated, and it has not accepted the allegation that the "TRNC" courts as a whole lacked independence and/or impartiality".ECtHR The decision of 02.09.2015. paragraph 237. The difference of TRNC than Transnistria, Abkhazia, and Crimea: On 25 June 2024, The European Court of Human Rights (ECtHR) [Ukraine v. Russia Case (Crimea); Applications 20958/14 and 38334/18] explained the reasons for the legality of the actions of TRNC laws in the north of Cyprus under the ECtHR framework (Why the situation of the TRNC differs from that of Crimea, Transnistria, and Abkhazia):

930. Whereas the Court held that "TRNC Domestic Law" was based on the Anglo-Saxon legal tradition and was therefore accepted as "law" for the purposes of the Convention, in cases concerning Transdniestria (the "MRT"), the Court found "no basis for assuming that [in the 'MRT'] there is a system reflecting a judicial tradition compatible with the Convention similar to the one in the remainder of the Republic of Moldova". The Court has reached similar conclusions regarding the "law" of Abkhazia and the "lawfulness" of Abkhaz courts.

932....Moreover, while the "MRT" and Abkhaz-related cases concerned the "law" of unrecognised entities that did not reflect "a judicial tradition ... similar to the one in the remainder of the Republic of Moldova" or "to the rest of Georgia" respectively, in Cyprus v. Turkey (merits) the Court held that "The civil courts operating in the 'TRNC' were in substance based on the Anglo-Saxon tradition and were not essentially different from the courts operating before the events of 1974 and from those which existed in the southern part of Cyprus". This particular aspect makes the latter case similar, yet different from the present case. The Cyprus v. Turkey case concerned the continued application of pre-existing Cypriot law valid in the territory of the "TRNC" before Turkey had obtained actual control of that territory, whereas the present case concerns the application in Crimea of the law of the Russian Federation (or the "law" of the local authorities, as its derivative) replacing the previously applicable and valid Ukrainian law.

Courts of Countries The USA: On 9 October 2014, the Federal Court of the United States (USA) stated that "the TRNC purportedly operates as a democratic republic with a president, prime minister, legislature and judiciary...The TRNC is NOT vulnerable to a lawsuit in Washington.". (State immunity: The protection which a sovereign state is given from being sued in the courts of other sovereign states.)

Greek Cypriot Toumazou applied to the USA Court of Appeals. The USA Court of Appeals rejected Toumazou, too on 15.01.2016

After the US Federal Court called and qualified TRNC as "Democratic Republic" and the USA Court of Appeals affirmed the decision, The United States Sectetary of State has started to describe the TRNC as the Area Administered by Turkish Cypriots