Nothing exposes the chasm between the activist wing and the donor class of the Democratic Party like the regulation of Wall Street.

The desire to assail too-big-to-fail-banks energizes the left and has propelled Senator Elizabeth Warren and the presidential campaign of Bernie Sanders. But some of the party’s most prodigious donors come from the financial industry and don’t much care for its vilification. And Bill Clinton’s administration oversaw the deregulation on Wall Street.

All that makes the question of how Hillary Clinton would regulate the financial sector a crucial test of her campaign to win the Democratic nomination. With a plan that is to be released Thursday, we get a first glimpse of how she walks that balance beam.

The short version: Directionally, Mrs. Clinton favors more intensive regulation of Wall Street than what is in place now. Bank executives and lobbyists will find little to like in her plan. But her approach stops short of the wholesale breakup of too-big-to-fail banks favored by Mr. Sanders and Mrs. Warren. She would prefer instead to take the philosophical approach embodied in the 2010 Dodd-Frank financial reform act a few steps further.

Mrs. Clinton proposes changes that would put stiff new costs on the largest banks and give regulators greater power to break up an institution they view as too sprawling and risky. But her plan does not envision a return to the era of the Glass-Steagall Act, the 1930s law requiring commercial banking and investment banking to remain separate. It was reversed by Congress during the Bill Clinton administration (an action that had less to do with the global financial crisis than many liberal activists would suggest).

Rather, her plan focuses on a series of changes to incentivize the biggest banks to shrink and simplify. It looks to reform markets that may be obscure to the general public but were actually key nodes in the 2008 global financial crisis. In particular, it concentrates on the multi-trillion dollar securities lending and repurchase market, which is a crucial piece of the world’s financial plumbing.

The Dodd-Frank law gave regulators a broad range of powers to oversee “systemically important” institutions. Combined with new international capital rules and more aggressive enforcement of corporate lawbreaking, it has made it more expensive than ever to be a sprawling global megabank. Giant banks like JPMorgan Chase and Citigroup were left to decide on their own whether to respond to those costs by slimming down, such as by selling or shutting down business units.

If Mrs. Clinton is elected president and gets her way — some of her ideas could be executed through regulatory fiat, others would require legislation — the incentive to slim down would be that much greater.

Here are the key elements of her plan.

A new “risk fee” on the largest financial firms. The biggest banks, insurers and other mega-financial firms already face greater oversight than their smaller rivals under the Dodd-Frank Act. Mrs. Clinton proposes taking that notion a step further by requiring a significant new fee, payable to the United States Treasury, for those very large firms that are potentially risky. Interestingly, its level is not determined by the size of a firm per se, but by the amount it relies upon volatile short-term funding to finance its operations.

So, for example, Wells Fargo has about twice the assets of Goldman Sachs, but primarily funds itself with bank deposits and engages in relatively plain consumer and business lending. A more complex firm like Goldman, which relies more heavily on fast-moving capital markets for funding, would thus have more to fear from the risk fee.

Mrs. Clinton’s proposal does not detail the exact scale or structure of the fee, which would require legislation. She envisions it as being substantial enough to have a meaningful impact on banks’ decision making. In other words: billions, not millions, of dollars.

Give regulators more power to break up financial firms. For all the discussion of whether to break up the too-big-to-fail banks in recent years, the actual legal tools that regulators have to do so are limited. Mrs. Clinton proposes granting regulators more explicit power to demand a firm downsize or break up. A campaign fact sheet adds that Mrs. Clinton “would appoint regulators who would both use these new authorities and the substantial authorities they already have to hold firms accountable.”

Dodd-Frank requires that major banks prepare “living wills” that describe the legal details of how they would be unwound in the event of a failure. But this proposed legislation would instead grant regulators more power to determine that, for example, a bank that had repeated major ethics scandals might just be too sprawling and complex to manage and therefore could endanger financial stability.

Regulate “shadow banking” more intensively. While the public debate about financial reform has concentrated on the too-big-to-fail banks, in many ways a bigger driver of the 2008 financial crisis was the “shadow banking” sector — segments of the financial system that resemble banks in important ways but are not regulated like them. It includes money market mutual funds, hedge funds and some parts of the insurance industry.

Her plans for addressing risks in those segments of the shadow banking system are still relatively vague, but she has more specifics on the securities lending and repurchase system, which was a key channel through which the failure of Lehman Brothers and near-failure of the insurer A.I.G. endangered the global financial system in 2008.

Mrs. Clinton calls for new international rules governing disclosure, margin and collateral requirements to try to make a failure of one global bank or insurer less likely to endanger the entire world economy. These are changes that are likely to take place through regulatory action rather than legislation.

With the first Democratic debate taking place next week, the stage is set for financial reform to be a major area where Mrs. Clinton and Mr. Sanders can clash.