This incisive book examines the relationship between federalism and democracy from a theoretical and comparative perspective. Arthur Benz proposes a novel understanding of why and how federal democracy can solve the dilemma of balancing effective governance with democratic legitimacy. Benz evaluates federal democracy as a complex system which is based on complementary principles that combine incongruent institutions. Based on historical, society-centred and actor-centred approaches, he analyses the potential frictions and constructive dynamics across diverse forms of federal government. In particular, he highlights the advantages of parliamentary democracy over presidential government. Chapters demonstrate the processes linking parliaments, parties, executives and interest groups across federal and regional jurisdictions, exploring how to enable intergovernmental coordination without restricting governments' autonomy. Understanding Federal Democracy is an important resource for scientists and students of political science and public policy, particularly those focusing on governance and democracy, federalism studies and regional government. Policymakers in the field will equally benefit from the book's academic and practical insights.