If conflict is sufficiently costly to the average citizen, then full democracies are unlikely to be at war with each other. However, they may be become very aggressive in their interactions with other types of regimes, so democracy is not always good for peace. Moreover, limited democracies will be the most aggressive regime types, if the leader thinks he can stay stay in power only by appealing to an aggressive minority. Empirically, we find that a dyad of limited democracies is more likely to be involved in a militarized dispute than any other pair of political regimes (including two dictatorships). A dyad of full democracies is less likely to be involved in a militarized dispute than any other pair. Thus, there seem to be strong non-linearities in the relationship between democracy and peace, with limited democracies inherently more aggressive than other regime types. This effect is not limited to a period of transition from democracy to dictatorship. Finally, we find that as the environment becomes more hostile as a country becomes less democratic, the probability of conflict increases most dramatically when it faces a democracy.