The aim of this paper is to clarify the basic concepts related to democracy as a political idea of state rule and to explain modern democracy. Namely, to achieve the same during the writing of the paper, the genesis of democracy as it is known today is included. Accordingly, the paper consists of four parts. The first part of the paper includes introductory remarks in which the topic of the paper is specified and determined. The second part of the paper explains the conceptual definition and historical development of democracy, its categorization and function. However, considering that the covered topic of the paper will not be complete without reference to modern democracy, the third part of the paper implies the importance of democracy in the 21st century and points to a fundamental topic called Modern Democracy and its characteristics. The fourth chapter presents an overview of modern democracy in the world, and the fifth, as the last, brings a conclusion on the whole topic.