What Is the Difference Between a State and a Territory?

The U.S. commonwealth of Puerto Rico is considered a territory.
The U.S. commonwealth of Guam is considered a territory.
Citizens in U.S. territories do not enjoy the full rights and privileges of the U.S. Constitution.
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  • Written By: Ron Andersen
  • Edited By: A. Joseph
  • Last Modified Date: 20 September 2014
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The main differences between a state and a territory is generally the type of government and the amount of representation its residents have in the government. A state can sometimes mean any governmental authority, whether it is a national government or a regional government. A territory can be any area claimed by a government, and they typically are characterized by their low population and their distance from the national government. A state and a territory both can have different meanings in different countries.

In the United States, a state is a distinct geographical area with its own autonomous government and national representatives. The difference between a state and a territory in the U.S. includes the legal standing of their residents. A citizen of a state enjoys the full rights and privileges granted in the U.S. Constitution, whereas citizens in U.S. territories do not.

Territories can be incorporated or unincorporated, and either kind can be organized or unorganized, resulting in four possible combinations or classifications. Generally, when people speak of territories, they mean an unincorporated organized territory. This type of territory has elected governors and legislatures, but citizens cannot vote in national elections and have only a non-voting representative in the national legislature. At the other end of the spectrum, an unorganized unincorporated territory is an area, such as coastal waters or airspace, where nobody lives but that is claimed by a national government.


A territory can be any area claimed by a national government. Even a ship at sea is considered the territory of whatever country’s flag it is flying. Whenever a commercial ship is sold, it can be “re-flagged,” and it becomes the sovereign territory of the new country. Commercial vessels are considered organized unincorporated territories. This is the same classification as the U.S. commonwealths of Guam and Puerto Rico.

When a country expands its borders, the new area is usually called a territory. Nearly all of the states in the U.S. started as territories. As populations increased and lines of communication improved, the people petitioned the federal government for statehood. In order for a territory to became a state, it must first become an organized incorporated territory.

A state and a territory can mean different things in different countries. Some countries can have territories but do not have states. Oftentimes, small islands are territories of a larger country. These can also be called possessions. In the case of uninhabited islands, they are legally referred to as incorporated unorganized territories.


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Post 3

People who live in U.S. territories can't vote, or send senators and representatives to Washington, but do they have to obey the laws of the U.S? I don't know if they pay taxes to the U.S. or if they have their own laws and policies.

The U.S. must have a good relationship with say, Puerto Rico and vice versa, or Puerto Rico would probably just pull apart from the U.S.

Post 2

I'm curious to know why territories of the United States, such as Puerto Rico, don't pay taxes. Since they receive funds from the U.S. government, I would think that they should pay taxes.

I would think that American companies would take advantage of "no taxes" and bring their company down to Puerto Rico. Maybe there is an exception here, I'm not sure.

Post 1

I know that there was a small movement awhile ago to make Puerto Rico the 51st state, but the measure failed. It would have allowed Puerto Ricans to receive governmental representation in the form of House members and two members of the Senate. It would have also afforded them the right to vote for President which they currently are not able to do.

This would have also required Puerto Ricans to pay federal taxes and many businesses would have lost their tax exempt status. I think that it would have been nice to add them as another state to our Union but I guess it wasn’t meant to be. They do receive aid from the United States as well as protection so maybe this is why they decided against statehood. They had a lot of the perks of being a state, but did not have to pay any taxes to the federal government.

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