Foreign policy cooperation between member states dates from the establishment of the Community in 1957, when member states negotiated as a block in international trade negotiations under the Common Commercial Policy. Steps for a more wide ranging coordination in foreign relations began in 1970 with the establishment of European Political Cooperation which created an informal consultation process between member states with the aim of forming common foreign policies. It was not, however, until the 1987, when European Political Cooperation was introduced on a formal basis by the Single European Act. EPC was renamed as the Common Foreign and Security Policy (CFSP) by the Maastricht Treaty.

The Maastricht Treaty gives the CFSP the aims of promoting both the EU's own interests and those of the international community as a whole. This includes promoting international co-operation, respect for human rights, democracy, and the rule of law.

The Amsterdam Treaty created the office of the High Representative for the Common Foreign and Security Policy (currently held by Javier Solana) to co-ordinate the EU's foreign policy. The High Representative, in conjunction with the current Presidency, speaks on behalf of the EU in foreign policy matters and can have the task of articulating ambiguous policy positions created by disagreements among member states. The Common Foreign and Security Policy requires unanimity among the now 27 member states on the appropriate policy to follow on any particular policy. The unanimity and difficult issues treated under the CFSP makes disagreements, such as those which occurred over the war in Iraq, not uncommon.

Besides the emerging international policy of the European Union, the international influence of the EU is also felt through enlargement. The perceived benefits of becoming a member of the EU act as an incentive for both political and economic reform in states wishing to fulfil the EU's accession criteria, and are considered a major factor contributing to the reform of former Communist countries in Eastern Europe.  This influence on the internal affairs of other countries is generally referred to as "soft power", as opposed to military "hard power".

Besides the CFSP, the Commission also has its own representation in international organisations. This is primarily through the European Commissioner for External Relations, who works alongside the High Representative. In the UN the EU has gained influence in areas such as aid due to its large contributions in that field (see below).In the G8, the EU has rights of membership besides chairing/hosting summit meetings and is represented at meetings by the presidents of the Commission and the Council. In the World Trade Organisation (WTO), where all 27 member states are represented, the EU as a body is represented by Trade Commissioner Peter Mandelson.

The European Community humanitarian aid office, or "ECHO", provides humanitarian aid from the EU to developing countries. In 2006 its budget amounted to 671 million euros, 48% of which went to the ACP countries.Counting the EU's own contributions and those of its member states together, the EU is the largest aid donor in the world.

The EU's aid has previously been criticised by the eurosceptic think-tank Open Europe for being inefficient, mis-targeted and linked to economic objectives. Furthermore, some charities have claimed European governments have inflated the amount they have spent on aid by incorrectly including money spent on debt relief, foreign students, and refugees. Under the de-inflated figures, the EU did not reach its internal aid target in 2006 and the EU would not reach the international target of 0.7% of GNP until 2015. However, only a few countries have reached that target. In 2005 EU aid was 0.34% of the GNP which was higher than that of the United States and Japan.The current commissioner for aid, Louis Michel, has called for aid to be delivered more rapidly, to greater effect, and on humanitarian principles.

Member states are responsible for their own territorial defence. Many EU members are also members of NATO although some member states follow policies of neutrality. The Western European Union (WEU) is a European security organisation related to the EU. In 1992, the WEU's relationship with the EU was defined, when the EU assigned it the "Petersberg tasks" (humanitarian missions such as peacekeeping and crisis management). These tasks were later transferred from the WEU to the EU by the Amsterdam Treaty; they formed part of the new CFSP and the European Security and Defence Policy. Elements of the WEU are currently being merged into the EU's CFSP, and the President of the WEU is currently CFSP High Representative.

Following the Kosovo War in 1999, the European Council agreed that "the Union must have the capacity for autonomous action, backed by credible military forces, the means to decide to use them, and the readiness to do so, in order to respond to international crises without prejudice to actions by NATO". To that end, a number of efforts were made to increase the EU's military capability, notably the Helsinki Headline Goal process. After much discussion, the most concrete result was the EU Battlegroups initiative, each of which is planned to be able to deploy quickly about 1500 men. EU forces have been deployed on peacekeeping missions from Africa to the former Yugoslavia and the Middle East. EU military operations are supported by a number of bodies, including the European Defence Agency, satellite centre and the military staff.