The paper deals with the notion of headedness, as applied to dimutive suffixation. Following evidence from Modern Greek and its dialects, we propose that diminutive suffixes are heads of their constructions on the basis of certain criteria. First, the inflectional paradigms of a number of diminutive formations show irregularities and gaps that are not justified by the inflectional behavior of the base. Second, diminutive suffixes may change a semantic feature of the base, specialize its meaning, and transmit to the formation the morphosyntactic features of gender and inflection class. Moreover, they are subject to subcategorization and selectional criteria, as opposed to inflectional markers, the distribution of which is more or less free. Assuming that headedness characterizes derivational suffixes, but not the inflectional ones, we demonstrate that Modern Greek diminution belongs to the derivational domain.