The study aims to analyze problems faced by pesantren (Islamic boarding schools in Indonesia) in the Post-Reform Indonesia by employing a historical-critical analysis approach. By relying on the related literature, the writer focuses on some serious problems faced by pesantren today, i.e. the emergence of a number of rigid religious expressions contrary to democratic values and the culture of pesantren. As argued in this paper, pesantren fundamentally has values inherent in the democratic society. From a historical perspective, pesantren since its inception has demonstrated the nature of tolerance by accepting diversity of the community. The pesantren’s moderation culture should be managed properly in order to create an understanding for mutual respect in a pluralistic society. At this point, pesantren as a tool to ignite social engineering needs to do a reformulation of its education system to form a democratic and civilized Muslim society.