Observers of this complex man have long puzzled over which component of his character is dominant - despot, pragmatist or (loosely speaking) democrat. Is he the autocrat who bombarded parliament in 1993, and led his nation into a bloodbath in Chechnya? Or is he the man whom the world remembers standing on a tank opposing the failed coup of 1991 - the same man who, for all his errors, presides over a country where the citizenry can read what they like, travel abroad, and (despite a manipulated press) say what they like.
The third, and more convincing, variant is that of a man who simply does what it takes to retain power.
But the freedom of worship issue placed Mr Yeltsin in a genuine quandary. It was a "difficult decision", he said. And he was right. The Bill would have restricted the activities of all but four religions which are classified as "traditional" in Russia - Orthodoxy, Islam, Judaism, and Buddhism. All other faiths would have to prove that they have been active in Russia for more than 15 years before they received legal rights.
The ostensible targets of the new laws were outlandish religious sects. But it was also an attempt by the Orthodox church to see off established rivals from abroad, such as the Catholics, who claim one million worshippers in Russia. As such, it blatantly violated the Russian constitution which says that all religions are equal.
The Bill forced Mr Yeltsin to make a choice in which he took a hit either way. Signing it would have dealt a blow to his relations with the United States at a time when Russia is still seeking further loans, investment and integration into international structures. The US Senate was poised to withhold $200m (pounds 122m) in aid had he signed.
But, by vetoing it, he has set himself at odds with the Orthodox church, an institution which stands close to the state. Mr Yeltsin is not especially devout, but he has forged close political ties with the church. During his election campaign, he rarely missed an opportunity to appear on television standing next to the Russian Patriarch, Alexy II.
Yesterday, the church maintained a stony silence about the President's decision. But the hierarchy will be displeased. Mr Yeltsin's decision has also intensified his running battle with his Communist-dominated Parliament, with whom he has been fighting on several fronts, notably over removing Lenin from his mausoleum on Red Square.
On the face of it, a stand-off is now looming between the Kremlin and the legislature when the latter returns to work in the autumn. Both houses overwhelmingly supported the Bill; they could override his veto with a two-thirds vote, forcing it into the courts.
Yesterday, there were bullish cries from the Communist camp. Viktor Iluykhin, a leading voice in the party, accused Mr Yeltsin of running a protectorate of the West. Another, Valentin Kuptsov, accused him of caving in to "voices from across the ocean".
However, none of this will worry Mr Yeltsin much. He relishes the opportunity to remind Parliament of its institutional weakness and his strength. And the Communist-nationalist opposition has proved so ineffectual that a debate has begun among Russia watchers over whether it amounts to an opposition at all.