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The traditional political divides of left and right have also intersected with arguments over devolution, which all the UK-wide parties have supported to some degree throughout their history (although both Labour and the Conservatives have swithered a number of times between supporting and opposing it). However, now that devolution has occurred, the main argument about Scotland's constitutional status remains between those who support Scottish independence and those who oppose it. Recent trends indicate, according to the State of the Nation Poll 2004, that 66% of Scots would like the Scottish Parliament to have more powers, while only 2% would like to see the powers returned to Westminster.

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.

In 1468 the last great acquisition of Scottish territory occurred when James III married Margaret of Denmark, receiving the Orkney Islands and the Shetland Islands in payment of her dowry.

The significance of coal, once Scotland's most important mineral resource, has declined. Oil, however, gained prominence in Scotland's economy during the 1970s, with the growth of North Sea oil extraction companies. Natural gas is also abundant in the North Sea fields. Aberdeen is the centre of the oil industry. Other important industries are textile production (woollens, worsteds, silks, and linens), distilling, and fishing. Textiles, beer, and whisky, which are among Scotland's chief exports, are produced in many towns. Salmon are taken from the Tay and the Dee, and numerous coastal towns and villages are supported by fishing from the North Sea. Only about one quarter of the land is under cultivation (principally in cereals and vegetables), but sheep raising is important in the mountainous regions.

Almost all residents of Scotland speak English, although many also speak various dialects of Lowland Scots which differ markedly from Scottish Standard English. Slightly greater than 1% of the population use Scottish Gaelic as their language of everyday use, primarily in the northern and western regions of the country. Almost all Scottish Gaelic speakers also speak fluent English.

During the 16th century, Scotland became embroiled in the throes of the Protestant Reformation. John Knox stood out as the primary figure in this battle. A disciple of John Calvin, Knox, waged fierce battles with the forces of Catholic orthodoxy and eventually converted the country to Presbyterianism. Only the most distant parts of the Highlands retained a taste for older forms. Presbyterianism first gained a foothold in 1556 but it didn't really get going until John Knox's firebrand oratory started stirring people up, most notably in Perth, when he roused the townsfolk so much that a mob scoured the countryside for Catholics after one of his sermons, destroying the old abbey at Scone in the process. Within a few years Parliament had legislated for a National Presbyterian church, the Catholic Queen had fled, Scotland had Protestant England rather than Catholic France as its main ally, and firm Presbyterian tutors were in charge of the upbringing of the infant King.

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).

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.

Scotland also has its own unique family of languages and dialects, helping to foster a strong sense of "Scottish-ness". An organisation called Iomairt Cholm Cille has been set up to support Gaelic-speaking communities in both Scotland and Ireland and to promote links between them.

Scotland has its own BBC services which include the national radio stations, BBC Radio Scotland and Scottish Gaelic language service, BBC Radio nan Gaidheal. There are also a number of BBC and independent local radio stations throughout the country. In addition to radio, BBC Scotland also runs two national television stations. Much of the output of BBC Scotland Television, such as news and current affairs programmes, and the Glasgow-based soap opera, River City, are intended for broadcast within Scotland, whilst others, such as drama and comedy programmes, aim at audiences throughout the UK and further afield. Sports coverage also differs, reflecting the fact that the country has its own football leagues, separate from those of England.

Scotland retains its own unique legal system, based on Roman law, which combines features of both civil law and common law. The terms of union with England specified the retention of separate systems. The barristers being called advocates, and the judges of the high court for civil cases are also the judges for the high court for criminal cases. Scots Law differs from England's common law system.

In 1997, the Blair Labour government of the United Kingdom held referendums on the issue of devolution: the creation of national assemblies in each of the three countries of the UK except England. Voters in all three countries voted in the affirmative, reversing parts of the three-hundred year old Union of the Parliaments. The new Scottish Parliament stands next to Holyrood House in Edinburgh.

Scotland, in the geographical sense it has retained for nearly a millennium, completed its expansion by the gradual subsumation of the Britons' kingdom of Strathclyde into Alba. In 1034, Duncan I, descended from Irish Ui Neill monastery protectors and appointed to the crown of Strathclyde some years earlier, inherited Alba from his maternal grandfather, Malcolm II. With the exception of Orkney, the Western Isles, Caithness and Sutherland, which had come under the sway of the Norse, Scotland stood unified.