The flags of the member states of the European Union flutter outside EU institutions, recent beehives of activity as top officials gathered from around the continent to respond to Britain’s momentous choice to leave the bloc behind.

Their colorful numbers have steadily increased along with the EU’s enlargement. But now, the Union Jack is set to reverse the trend. With its choice in the June 23 referendum to end its more than four-decade-long membership, Britain in one swoop has reduced the EU’s size and sway – and rocked its fragile balance of power.

That has left Brussels hunkered down with the economic and political fallout, and seeking to understand what this moment means – and how best to respond. Anger directed at Britain has mounted to a fever pitch, but so, too, has frustration with itself – for this is understood both as Britain’s loss and Europe’s failure. And now it’s up to EU leaders to recalibrate and stop a further breakup, not only by delivering concrete results to citizens, like jobs, but also by making sure their case for unity is heard over the storm of criticism coming from Euroskeptics poised to take advantage at a turning point.

“I hope that this will spur everyone else, whether they’re on the right or the left, to go much more on the offensive than we have been,” says Elisabeth Guigou, president of the French National Assembly’s Foreign Affairs Commission. She argues that disillusionment with the project is the bloc’s greatest problem today. “I think that in order to defeat this skepticism, this phobia, it’s not grand, general speeches that are going to convince anyone. It’s first and foremost, yes or no: Are we able, with the European Union, to bring solutions to the principal worries of European citizens?”

For now Brussels is bracing for what was once the unthinkable: divorcing itself from a member state, a process that has no practical precedent, although it’s laid out as a two-year process in Article 50 of the Treaty of Lisbon.

At the daily briefing for journalists at the European Commission on the Monday that followed the “Brexit” vote, chief spokesman Margaritis Schinas tried to maintain calm. But he was opaque when peppered with questions about border crossings between Northern Ireland and Ireland, and the status of British officials in the EU – an indication of the many unanswered questions ahead.

As of press time, Britain had yet to invoke Article 50, with outgoing Prime Minister David Cameron saying it was a task best left to his successor, expected to be in place in the fall. But most European leaders agree they want Article 50 invoked quickly, to lift the cloud of political and economic uncertainty that has seen markets tumble, and to allow the bloc to focus on the many challenges on its plate. Those include stagnant growth and the need to create a full economic and monetary union. Europe must also deal with security and terrorism threats as well as flows of immigrants and refugees.

And Europeans are wary of giving Britain political breathing space. During an appearance at an extraordinary session called at the EU Parliament June 28, Jean-Claude Juncker, president of the European Commission, confronted leading Brexiteer Nigel Farage, leader of the United Kingdom Independence Party (UKIP). “You were fighting for the exit; the British people voted in favor of the exit. Why are you here?”

German Chancellor Angela Merkel, the most powerful leader in Europe, has shown a cooler head. Her strategy, says Josef Janning, a senior policy fellow at the European Council on Foreign Relations, is meant to deter further anti-EU sentiment. “It is important not to be seen as punishing Britain. This would be fuel on the fire of populists because they would say, ‘Here you see the totally undemocratic nature of European politics. And now that the people have spoken, the people get punished,’ ” he says.

But Ms. Merkel, too, wants the process to proceed, so that the consequences, from market uncertainty to unwieldy logistics, act as a deterrent. “The approach will be to have the Brits punish themselves,” Mr. Janning says.

Anti-EU forces

Still, anti-EU forces are seeking to take advantage of the momentum. Marine Le Pen of France’s National Front is now calling for a “Frexit,” while Geert Wilders, head of the Netherlands’ Party for Freedom, is musing about a “Nexit.”

“It’s a moral boost for us. We want a different Europe,” says Ronald Gläser, spokesperson for the Berlin chapter of the Alternative for Germany (AfD), the anti-immigrant, anti-EU party. “We want a union of sovereign nation-states where each country makes its own decisions.”

The rise of the AfD has shocked Germany, where extremism has been more politically taboo after World War II than elsewhere in Europe. The party rose because of resentment over Germany’s “bailout” of Greece, and then grew after Merkel’s handling of the refugee flows that spiked last summer. Now, with Britain on its way out, taking its contributions to the EU budget with it, Mr. Gläser predicts German anger will grow.

It’s not just the Euroskeptics who have stoked frustrations with the EU. Many analysts fault mainstream politicians for using Brussels as an easy scapegoat. Its muddling, bureaucratic nature has drawn widespread criticism. But politicians also blame it for domestic problems that often have more to do with either a lack of reform at home or a globalized, deindustrialized economy that has profited urban, young, and educated workers but left many older, working-class voters behind – the exact demographic that voted for Brexit.

That’s created a branding problem for the EU, says Rana Deep Islam, German nonresident fellow at the American Institute for Contemporary German Studies at Johns Hopkins University. “It’s quite a challenge to reframe itself,” he says. “I often wonder what a company would do: If you have a company brand that is so demolished, would you rebrand the product, or would you rebuild it? I don’t have an answer on that.”

The populist factor

In many cases, mainstream politicians have also chased after populists to win back votes. The Brexit referendum may not have happened in the first place if UKIP hadn’t come onto the scene, putting pressure on Mr. Cameron to appease the rightmost wing of his Tory party.

Yves Bertoncini, director of the Notre Europe-Jacques Delors Institute in Paris, says populists will have trouble setting off a cascade of referendums. For starters, in France, Ms. Le Pen would first need to win next year’s 2017 presidential election, a possibility but still a remote one.

While the high level of Euroskepticism in France received widespread attention after a Pew survey of 10 countries in June showed it was second only to Greece in its dissatisfaction with the EU, Mr. Bertoncini distinguishes that from a desire to leave the bloc or its currency. In a late June poll, 45 percent of French said they would choose to stay if there were a “Frexit” referendum, compared with 33 percent who would leave. Indeed, Bertoncini says, there are far more “Franco-skeptics” than “Euro-skeptics” in France, whereas Britain has had a fault line running through it on Europe since joining the bloc in 1973.

The countries that now represent a threat of departure are those on the periphery, like Denmark, that have not adopted the euro but have strong populist strains. Still, the significance of the moment should not be underestimated, Bertoncini says. “It’s probably the most important geopolitical evolution since the fall of the Berlin Wall. It is an earthquake. As with any earthquake, we will face aftershocks.”

Germany’s role

The Reichstag building in Berlin, opened in 1894 to house the parliament of the German Empire, fell into disuse after World War II. It reopened again only in 1999, when Berlin officially became the capital once again of a reunified Germany. Ever since, the glass-domed edifice has stood as a symbol of steady, uncontroversial German power in a stabilized Europe.

Now the power vacuum created by Brexit puts that into question. Britain acted as a bridge between founding members like France and Germany, which push for deeper integration, and the Nordic countries and those outside the eurozone. Perhaps the greatest concern is that German power will grow too dominant, one of the reasons the EU was founded in the first place. “There is quite a bit of anxiety amongst some of the newer member countries, like Poland and the Czech Republic,” says Joerg Forbrig, a transatlantic fellow for Central and Eastern Europe at the US German Marshall Fund in Berlin.

“For them the UK was always a generator of confidence in the EU. They trusted the UK historically, their positions often coincided politically, and having Britain in the EU reduced some of their fears of a dominant Germany,” he says. “The UK acted as a bit of a buffer.”

Daniel Pawlowiec, a Pole who works at the EU Parliament, says that while older member states like Britain have become more disillusioned with the EU than newer members like his own country, even the newcomers’ optimism is waning. “What will be the position of small countries? It could be the beginning of the end,” he says.

Good riddance?

Not everyone views Brexit as a negative. Britain angered other member states for the ambivalence that caused it to fight for exceptions to rules, including participating on refugee policy. It angered southern Europe by siding with Germany on austerity. With it gone, no one expects a radically different Europe. Talks on reform, including everything from a “two-speed” Europe between core and periphery members to handing more power back to national governments, have been on the table for years, and Europe remains as divided as ever, including over how to deal with Brexit.

But the shock has sparked hope in some corners that Europe must begin to address the alienation of members spurred by a lack of jobs and crushing austerity.

“They need to make Europe attractive again: create equality, reduce policies that only benefit 1 percent of the population, restore democracy, accept what people need and how they vote and not what the markets are dictating,” says Stelios Kouloglou, a Greek EU parliamentarian from the Syriza party, which came into office on an anti-EU platform and risked setting Greece tumbling out of the eurozone. That is still a possibility – one that would deliver an even bigger shock, since there is no rule book for an exit from the currency.

Mr. Kouloglou says 10 years ago, no one would have ever conceived of exiting the EU, but the strains are mounting daily.

It could lead France, bogged down in its own economic malaise, to lead southern Europe to rally for job creation over austerity. As Italian Prime Minister Matteo Renzi put it on June 27: “Allow me to say that Brexit can be a great opportunity for Europe.”

Britons in Brussels

For most, however, this is a dark chapter for Europeans, probably worst for British employees here in Brussels. In the cafeteria at the EU Commission, a British audiovisual services staffer – who is originally from Boston, Lincolnshire, a Leave stronghold – says that many people tried to reassure her that everything would be OK.

“But I think others are thinking, ‘Oh, thank God, they’re gone,’ ” says the staffer, who asked for anonymity because she was not authorized to talk to journalists. “Britain hasn’t wanted to play the game for a long time, so you can’t blame them for wanting to leave. But I cried when I heard the news.”

Sibyl Steuwer, a 30-something researcher at Free University of Berlin, says her generation grew up with the Erasmus school exchange program, borderless travel, and the chance to work in any member state. “My generation understands Europe as a project,” she says. “My greatest concern is that Brexit encourages the criticism of the EU to go on. If you have such a big union, it of course takes time to reform, but it was going in the right direction.”

European Council President Donald Tusk, speaking after an informal meeting of all EU members but Britain, said it was time to get back to bloc ideals. “We ... discussed the fact that too many people in Europe are unhappy with the current state of affairs and ... expect us to do better. Many recalled that for decades Europe was bringing hope and that we have a responsibility to return to that.”

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To do that, the current leadership will need to step up, says French lawmaker Ms. Guigou. “If we want to get back to a European spirit – which has completely disappeared – we need to start talking about, first of all, what we’re proud of having done together,” she says.

Faced with constant criticism from within the bloc and from Russia and even the United States, the EU has lost the positive message about Europe’s standards on human rights, social progress, and even prosperity, even if the challenges are mounting, she argues. “We need to have the courage to say all this.”