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Most Scottish industry and commerce is concentrated in a few large cities on the waterways of the central lowlands. Edinburgh, on the Firth of Forth, is a cultural centre, the capital of Scotland, and one of the the top financial centres in Europe. Glasgow, one of the largest cities in the UK, lies on the Clyde; it is Scotland's leading seaport and was once a centre of shipbuilding and it supports numerous light industries. Although heavy industry has declined, the high-technology Silicon Glen corridor has developed between Glasgow and Edinburgh. Tourism is also very important.

The Parliament is elected with a Proportional Representation electoral system, namely, the Additional Members System. This is unlike Westminster which is still elected by the First Past the Post method. It is elected every four years and contains 129 members (referred to as MSPs).

This state of affairs continued until May 1999 when Scotland's Parliament was established following a referendum. Whereas the old Scottish Parliament had functioned as the full parliament of a sovereign state, the new parliament governs the country only on domestic matters, the United Kingdom Parliament having retained responsibility for Scotland's defence, international relations and certain other areas.

The Scottish National Party (SNP) was formed in the 1930s with the aim of achieving Scottish independence. They are broadly on the left-of-centre and are in the European Social-Democratic mould. They are currently the second most popular party electorally, although their highpoint appears to have been in the 1970s.

Before 1975 local government in Scotland was organised on the county system. In reforms that took effect from 1975, the Conservative government of Edward Heath introduced a system of two-tier local government in Scotland, divided between large Regional Councils and smaller District Councils. The only exceptions to this were the three Island Councils, Western Isles, Shetland and Orkney which had the combined powers of Regions and Districts. In 1995 the Conservative government of John Major decided to abolish this system and merge their powers into new Unitary Authorities, roughly equivalent to the old counties.

In 1326, the first full Scottish Parliament met. The parliament had evolved from an earlier council of nobility and clergy, the colloquium, constituted around 1235, but in 1326 representatives of the burghs — the burgh commissioners — joined them to form the Three Estates.

After World War II Scotland's economic situation became progressively worse until the 1970s, and only began to turn around after the discovery and development of North Sea oil and gas. During this period the Scottish National Party refocused their arguments for Scottish independence around their "It's Scotland's Oil" campaign.