This chapter examines the impact of war on economic and political changes in the Western nations leading to militarization of their economies and the rise of the modern military-industrial complex. It discusses how in the early twentieth century entire societies became reorganized for purposes of industrialized warfare. The chapter also examines the emergence and expansion of the military-industrial complex within democratic nations and its long-term impact on the institutions and policies of these nations. The military-industrial complex is a permanent institutional arrangement that combines the armed forces, the arms industry, and the government. A defining feature of the military-industrial complex is close coordination between the government, the military, and the arms industry. In Europe and North America, patterns of interaction between these institutions crystallized by the mid-nineteenth century and turned into a self-sustaining process of continuous coordination by the early twentieth century.