This paper examines the impact of district magnitude, defined as the number of representatives elected per district, on the number of political parties. Conventional wisdom, supported by cross-national and within-country studies, indicates a positive and curvilinear relationship between district magnitude and the number of parties, with diminishing returns in larger-magnitude districts. However, this relationship is complicated by the increasing regionalization of party systems and the distinct socio-economic compositions of districts correlated with district magnitude. To address these limitations and obtain an appropriate counterfactual, we employ a quasi-experimental design using data from Spain, where district magnitude changes by only one seat in some districts and elections. Our findings align with previous research, confirming that the number of electoral parties increases with district magnitude, particularly in low-magnitude districts.