This paper discusses the influence of institutions and project context in the arrangement of large-scale projects, by specifically exploring their vertical connection to the industry sector. It explores the idea that institutional management should precede technical management into seeking project legitimacy. Through a comparative case study of High-Speed Rail projects in Spain and the Netherlands, mainly based on secondary data, we investigate the process through which the institutional context determines the decisions for project arrangements. The paper makes two contributions to the field of projects studies. The first is the theoretical application of a neo-institutional lens to shed light on the interrelation between large-scale projects and their environment, by bringing project legitimacy to the forefront. The second is our observation on the endogenous shifting approaches of institutionalization, in the constant struggle to acquire legitimacy. That is, at the first phase prescribed through the institutional environment as dominant, it is moral/normative legitimacy that reflects the positive normative evaluation of the organization and its activities. Whereas, at the second phase, where the technical environment is dominant, pragmatic legitimacy is at function.