The characteristics of a true democracy are the right of citizens to choose their government representatives, a government with limited powers, majority rule, minority rights, and effective checks and balances on the government. Democracies are maintained through rule of law as established by a written constitution.
Democracies take one of two main forms. Direct democracies allow citizens to directly participate in making public policy, so it is more feasible for smaller communities. Representative democracies are set up so citizens vote for representatives who actually make the laws instead of voting directly on each law.
A system in which the majority always creates the rules is not inherently democratic because it allows for the possibility that a slight majority of people might choose to oppress everyone else. The balance between majority rule and minority rights in a democracy is accomplished by creating laws that protect the rights of minorities while allowing the majority to vote on everything else. These laws are typically included in the country's constitution to prevent future majorities from altering them.
Freedom of expression and the separation of the state from social and business organizations is essential for a democracy to function effectively. In countries where the government controls the press or operates businesses, abuses of power can undermine attempts at establishing and maintaining a democracy.