Government
Type: Constitutional monarchy.
Independence: 1839.
Constitution: 1868.
Branches: Executive--Grand Duke (chief of state). Legislative--bicameral parliament (Chamber of Deputies and Council of State). Judicial--superior court.
Political parties: Christian Socialist Party (CSV), Socialist Party (LSAP), Democratic (liberal) Party (DP), Green Alternative Party (GAP), Party for Pension Rights (ADR).
Suffrage: Universal over age of 18.
Government budget (2003): $7.0485 billion.

Government of Luxembourg
Luxembourg has a parliamentary form of government with a constitutional monarchy by inheritance. Under the constitution of 1868, as amended, executive power is exercised by the Grand Duke and the Council of Government (cabinet), which consists of a prime minister and several other ministers. The prime minister is the leader of the political party or coalition of parties having the most seats in parliament.

Legislative power is vested in the Chamber of Deputies, elected directly to 5-year terms. A second body, the "Conseil d'Etat" (Council of State), composed of 21 ordinary citizens appointed by the Grand Duke, advises the Chamber of Deputies in the drafting of legislation. The responsibilities of the members of the Conseil d'Etat are extracurricular to their normal professional duties.

Luxembourg law is a composite of local practice, legal tradition, and French, Belgian, and German systems. The apex of the judicial system is the superior court, whose judges are appointed by the Grand Duke.
source: http://www.state.gov