When the economic reform (NEM) was introduced in Hungary in early 1968, it was announced that political reforms aiming at the "democratization of the socialist system" would also be made. The Hungarian Socialist Workers' Party (MSZMP) and the government stated that economic decentralization would be accompanied by the "strengthening of socialist democracy and the broadening of the participation of the masses in political activities." Several measures were taken to promote this objective through discussion and debate–but not through dissent or decision-making. After the Soviet invasion of Czechoslovakia in August 1968, which seriously affected the entire East European bloc, Hungary's move toward democratization became less pronounced and the government's policy definitely more cautious both in words and deeds. In this study I attempt to analyze the meaning and scope of the political changes that took place in Hungary in the aftermath of Czechoslovakia, giving special attention to the concept of democracy, the organization of the party and government, the position of the mass organizations, and the meaning of the increasing group conflicts.