The Government of Bhutan has been a constitutional monarchy since 18 July 2008. The King of Bhutan is the head of state. The executive power is exercised by the Lhengye Zhungtshog, or council of ministers, headed by the Prime Minister. Legislative power is vested in the bicameral Parliament, both the upper house, National Council, and the lower house, National Assembly. A royal edict issued on April 22, 2007 lifted the previous ban on political parties in anticipation of the National Assembly elections in the following year. In 2008, Bhutan adopted its first modern Constitution, codifying the institutions of government and the legal framework for a democratic multi-party system.

The Druk Gyalpo is the head of state of the Kingdom of Bhutan. In the Dzongkha language, Bhutan is known as Drukyul which translates as "The Land of the Thunder Dragon". Thus, while kings of Bhutan are known as Druk Gyalpo, the Bhutanese people call themselves the Drukpa, meaning "people of Druk (Bhutan)".