From 1968 to 1997, wealthy, advanced democracies generally did not suffer from high levels of chronic terrorism, with two exceptions: (a) advanced democracies that interfered in other countries' affairs through military intervention or occupations were frequent targets of transnational terrorism, and (b) poor democracies with territorial conflicts often experienced related domestic terrorist attacks. Intermediately wealthy and transitioning democracies with internally inconsistent institutions were more likely to experience domestic terrorism than advanced democracies and authoritarian regimes. There is very little agreement about why these trends persist. I identify the competing explanations that have emerged within the literature as well as remaining controversies. I also present preliminary evidence suggesting that since 9/11, terrorism persists in the usual pattern but may be increasingly prevalent in nondemocratic countries. I offer five speculative explanations for this and four suggestions for how the field should proceed.