Final answer:
Federalism is a system of government where power is divided between a central authority and regional governments, creating a federation. It is based on democratic rules and institutions and allows for the sharing of power and political autonomy among different ethnicities or nationalities.
Step-by-step explanation:
Federalism is the system of government in which sovereignty (the authority and power to govern over a group of people) is constitutionally divided between a central, or national government, and individual regional political units generally referred to as states. It is based upon democratic rules and institutions in which the power to govern is shared between national and state governments, creating a federation.
Federations, as these kinds of governments are called, may also work best when the country is multi-ethnic or multi-national in nature. Rather than split a country into multiple nation-states, a country's leadership can give each of its ethnicities, or nationalities, some measure of political autonomy.
Federalism is marked by a sharing of power between the central government and state, provincial, or local governing bodies. The United States is one example of a federal republic. The U.S. Constitution grants specific powers to the national government while retaining other powers for the states.