The democratic peace theory proposes that democratic states are less likely to go to war with each other, but will go to war with nondemocratic states, and usually win. This is a theory that has generated much controversy. There is no denial that peace exists between democracies, but the controversies arise over why.

The twenty-first century has seen a rise in China (an autocratic state) and its struggle to obtain a presence on the world stage and equality with the United States (a democratic state). There has not been a militarized dispute between them and they report billions of dollars in trade each year. Which begs the question, how has the United States-China trade relationship challenged the democratic peace theory?

To answer this question a thorough review of the democratic peace theory becomes necessary as an aim to introducing the theory and reviewing the literature advanced by democratic peace theorists. A discussion of the theory's origins, central features, limits and its critics is presented. The opening of China and its economy in relationship with the United States is analyzed to show how trade interdependence has meant closer and increased trade.

I argue that the United States-China relationship, which addresses the peaceful constraints of economic interdependence, can reveal important limits of the democratic peace theory. The method chosen to examine the argument is based on a case study of the peaceful relationship between the United States and China. The selected cases provide trade data to assess the magnitude of trade interdependence between them. Concluding that the theory is limited in that it fails to address the influence of trade interdependence as a better explanation for peace, and not democratic processes.