The proposition that competitive markets and competition law promote democracy constitutes a fundamental normative prior, if not a foundational myth, of US and European Union competition law. This article purports to unpack this notion of a competition–democracy nexus. It argues that the idea of a competition–democracy nexus can only be explained by the normative commitment to a specific understanding of liberty: namely, the republican concept of liberty as non-domination. On this basis, the article makes three contributions. First, on a conceptual level, it is the first to pin down a clear and theoretically consistent answer to the question of how competition and competition law further democracy. Second, on a historical level it traces how iterations of the ideal of republican liberty and the associated notion of a competition–democracy nexus shaped competition law in the United States of America (USA) and Europe and why both disappeared from our modern competition law landscape. The third contribution is practical. The article sheds light on how the ideal of republican liberty and the competition–democracy nexus can be operationalized through concrete competition law tools and how they could inform ongoing debates on the future of competition law in light of the current challenges posed by the rise of industry concentration notably in digital markets. A revival of the idea of a competition–democracy nexus, the article concludes, must not inevitably conflict with a consumer-oriented competition policy, but requires a radical rethink of the role of competition law.