A system and method for controlling power and performance in a microprocessor system includes a monitoring and control system integrated into a microprocessor system. The monitoring and control system includes a hierarchical architecture having a plurality of layers. Each layer in the hierarchal architecture is responsive to commands from a higher level, and the commands provide instructions on operations and power distribution, such that the higher levels provide modes of operation and budgets to lower levels and the lower levels provide feedback to the higher levels to control and manage power usage in the microprocessor system both globally and locally.