The Democratic Party (DP) was formed on 8 April 1989, when the former Progressive Federal Party, Independent Party and National Democratic Movement merged. Under the combined leadership of Zach de Beer, Denis Worrall and Wynand Malan, the DP won 36 seats in Parliament in the general election of September that year.

However, the history of the DP goes back to 1959 when a number of liberal members of the United Party (UP) broke away to form the Progressive Party (PP). The cause of the split was the UP's inability to find a clear-cut alternative to the National Party's apartheid policy. The PP took its stand on constitutional reform, calling for an entrenched Constitution incorporating a Bill of Rights, for an independent judiciary and for a federal Constitution in which the powers of the provinces would be constitutionally protected. It stood for an economy based upon free enterprise. It would be 35 years before the members of the Progressive Party saw their ideals realized in South Africa's interim Constitution.

In the 1961 election only Mrs Helen Suzman kept her seat in Parliament for the PP. Thus began one of the great parliamentary performances of all time: Mrs Suzman sat alone for 13 years, the sole principled opponent of racial discrimination in the whole South African Parliament. She fought against detention without trial, pass laws, influx control, job reservation on grounds of colour, racially separate amenities, Group Areas and forced removals. She demanded trade union rights for Black people and fought for better wages and working conditions. In 1974 six more PP members won seats in Parliament. Soon after this the PP merged with a new breakaway group from the United Party, the Reform Party, to become the Progressive Reform Party in 1975. In 1977 another group of UP members left the Party to form the Committee for a United Opposition, which then joined the PRP to form the Progressive Federal Party.

During 1987 Denis Worrall resigned as South African ambassador in London to return to politics. He formed the Independent Movement to fight the 1987 general election. Only Wynand Malan won his seat and when Mr Malan left the Independent Movement, Mr Worrall formed the Independent Party. Mr Malan, together with others, formed the National Democratic Movement. The PFP had lost a number of Parliamentary seats in the 1987 election and in 1988 Zach de Beer became the PFP leader. He continued negotiations which culminated in the IP, NDM and PFP disbanding to form the Democratic Party in April 1989. The National Party government immediately called a general election for September of that year, in which the DP improved its position while the NP lost seats both to the DP and to the right-wing Conservative Party.

This was the turning point for NP leader FW de Klerk, who announced a radical change in government policy on February 2 1990. With the unbanning of the ANC, PAC and other liberation organisations, and the release of Nelson Mandela, the process of negotiating a peaceful solution to South Africa's political impasse began. DP leader Zach de Beer was chosen as the first Management Committee Chairman of Codesa. Both in Codesa and the subsequent Multi-Party Negotiating Process held at the World Trade Centre in Kempton Park, the DP played a vital role in the negotiation of an Interim Constitution which included most of the principles and ideals around which the PP was formed in 1959.

The April 1994 general election was the liberation election, the first in which all South Africans voted together. The ANC recorded a significant victory, with the DP winning only 1,7% of the vote on the national level. With only 10 Members of Parliament, and under the leadership of Tony Leon, the DP began a new fight: one for the protection of human rights and the extension of federalism and free enterprise in South Africa. In the 1999 general election the DP vastly improved its showing becoming the official opposition with 9.6% of the votes and 44 seats. In 2000 the Democratic Party was renamed the Democratic Alliance, with Tony Leon maintaining the helm.