The article examines the limits and challenges small powers face when they adjust to systemic changes. Specifically, this article discusses the Philippines' conduct of a diplomatic strategy of equi-balancing between the USA and China. In this strategy, the Philippines enhances and deepens its security relations with its strategic ally, the USA and at the same time, obtains economic assistance and politico-diplomatic concessions from East Asia's emergent power, China. The Philippines' diplomatic gambit, however, is restrained by its formal alliance with the USA and its chronic territorial dispute with China over the Spratly Islands. At present, several developments are undermining Manila's efforts in playing this balancing game with Washington and Beijing. These are: the Philippines' passive role in this triangular relation; its status as Washington's formal treaty; its volatile domestic politics; and the tension in Philippine–China relations generated by the two countries' territorial dispute. In conclusion, the article warns that current dynamics in both Philippine–US and Sino–US relations can transform the Philippine role in this triangle from a passive and opportunistic balancer to a pawn, or a spoil, or a perpetual weak/buffer state – a tragic victim of 21st century big power realpolitik.