Abstract In this paper we examine the effect of the current economic crisis on the environmental performance of the EU countries. By employing Hierarchical Linear Multilevel (HLM) modeling we find that, for the period 2000–2015, a drop in the national GDP (a “recession effect”) as well as endorsing a Memorandum of Understanding (MoU) for receiving a IMF/EU/ECB financial “rescue-package” (a “Troika effect”) have non-significant to positive impacts on a number of national environmental quality and policy indicators, over and above other (economic, political and governance) predictors, for Eurozone and non-Eurozone countries alike. Nevertheless, this changes drastically if we examine these two factors' interaction: experiencing a ‘recession’ while being a recipient of a Troika-sponsored ‘rescue package’ has detrimental effects on an EU country's national environment.