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What explains the variation in terrorism within and across political regimes? We contend that terrorism is most likely to occur in contexts in which governments cannot credibly restrain themselves from abusing their power in the future. We consider a specific institutional arrangement, whether a state has an independent judiciary, and hypothesize that independent judiciaries make government commitments more credible, thereby providing less incentive for the use of terrorism. Using a recently released database that includes transnational and domestic terrorist events from 1970 to 1997, we estimate a set of statistical analyses appropriate for the challenges of terrorism data and then examine the robustness of the results. The results provide support for the credible commitment logic and offer insights into the different ways that political institutions increase or decrease terrorism.