This study examines the relationship between education level and unemployment at the municipal level in Sweden during the period 2001-2021. Using a quantitative method and panel data, the study analyzes how changes in education levels within municipalities over time are associated with changes in unemployment. The study applies fixed effects models with clustered standard errors to control for time-invariant differences between municipalities as well as common changes over time. In the analysis, unemployment is used as the dependent variable, while education level, measured as the share of the population with post-secondary education, is the main independent variable. To control for other factors that may affect unemployment, several control variables are included, such as income, population size, share of foreign-born individuals, population density, and share of working-age population. Some variables, such as income and population size, are log-transformed to allow interpretation in percentage terms. The results show that the relationship between education level and unemployment is sensitive to model specification. In simpler models, a negative relationship is observed, which is in line with human capital theory. However, when municipality and time fixed effects are included, the relationship changes, indicating that it is influenced by underlying structural and regional factors.