In this paper we study the degeneracy phenomenon arising in optimal control problems with state constraints. It is shown that this phenomenon occurs because of the incompleteness of the standard variants of Pontryagin's maximum principle for problems with state constraints. The new maximum principle containing some additional information about the behavior of the Hamiltonian at the endtimes is developed. As application we obtain some sufficient and necessary conditions for nondegeneracy and pointwise nontriviality of the maximum principle. The results obtained envelope the optimal control problems with systems described by differential inclusions and ordinary differential equations. © 1995.