Around the world, federalism has emerged as the system of choice for nascent republics and established nations alike. This book considers the most promising forms of federal governance and the most effective path to enacting federal policies. The result is an essential guide to federalism, its principles, its applications, and its potential to enhance democratic governance. The book assess different models of federalism and their relative abilities to promote economic efficiency, encourage the participation of citizens, and protect individual liberties. Under the right conditions, the book argues, a federal democracy—including a national legislature with locally elected representatives—can best achieve these goals. Because a stable union between the national and local governments is key, the book also proposes an innovative method for evaluating new federal laws and their possible impact on state and local governments. Finally, to show what the adoption of federalism can mean for citizens, the book discusses the evolution of governance in the European Union and South Africa's transition from apartheid to a multiracial democracy. Interdisciplinary in approach, the book brims with applicable policy ideas and comparative case studies of global significance.