Sovereignty is the central organizing principle of the system of states. At its core, sovereignty is typically taken to mean the possession of absolute authority within a bounded territorial space. There is essentially an internal and external dimension of sovereignty. Internally, a sovereign government is a fixed authority with a settled population that possesses a monopoly on the use of force. It is the supreme authority within its territory. Externally, sovereignty is the entry ticket into the society of states. Recognition on the part of other states helps to ensure territorial integrity and is the entree into participating in diplomacy and international organizations on an equal footing with other states. Threats to state sovereignty from a wide variety of sources, can be grouped in three broad areas: the rise of human rights, economic globalization, and the growth of supranational institutions, the latter being partially driven by economic integration and the cause of human rights.

1. The emergence of human rights as a subject of concern in international law effects sovereignty because these agreed upon principles place clear limits on the authority of governments to act within their borders.
2. As a result  of the growth of multinational corporations and the free flow of capital, internal policymaking, investment, employment and revenue within a state is often affected by the activities of MNCs and changes in the world economy. Keynesian-based welfare policies, and import or tariff barriers by governments (state interventionism) which were used by governments to protect home industry in an era of ''embedded liberalism'' are now much harder to implement. This is because state economies are no longer ''managed'' by state governments but are subject to external forces, such as recession, inflation and trade agreements, due to the interconnectedness of the world economy. However, it must be underlined that some states can manage better in this situation, and are able to ''restore boundaries'' and take advantage also of the regionalisation of the world economy, for example the USA or the European Union, respectively. Thus, the trends within the world system are not uniform in their impact upon individual states, but there is a definite disjuncture between the idea of a sovereign state determining its own future and modern economies, which are intersected by international economic forces.
3. With the increase in global connectedness, the number of political instruments available to governments and the effectiveness of particular instruments has shown a marked decline; border controls have lessened; and flow of goods and services, ideas and cultures has increased. Due to globalization, highly interconnected global order, many of the traditional domains of state activity such as defence, communication, can not be fulfilled without resorting to international forms of collaboration. As the demands on the state have increased in the postwar years, the cooperation of other states has become necessary. Accordingly, states have had to increase the level of their political integration with other states so as to control the destabilising effects that accompany global interconnectedness. They have to strengthen by forming some blocks like the NATO, the CENTO, the OAS, the International Monetary Fund (IMF) and the World Trade Organisation (WTO). With the growth of a vast number of institutions and organisations, independent sovereinty of a state diminishes. The international organisations are setting up international standards to be followed by the individual states. There are many controversial organisations like the IMF, UNCTAD and WTO which are non-state actors and have usurped the functions of state. They even take up a supranational role in certain areas. The European Union (EU) provides a bigger threat to the sovereignty of the states. Members of the EU have delegated their sovereignty in certain matters to the Union. The EU has become, more or less, a supranational agency, for within it, the Council has the power to make or enact policies.