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Examining onsets of political instability in countries worldwide from 1955 to 2003, we develop a model that distinguishes countries that experienced instability from those that remained stable with a two‐year lead time and over 80% accuracy. Intriguingly, the model uses few variables and a simple specification. The model is accurate in forecasting the onsets of both violent civil wars and nonviolent democratic reversals, suggesting common factors in both types of change. Whereas regime type is typically measured using linear or binary indicators of democracy/autocracy derived from the 21‐point Polity scale, the model uses a nonlinear five‐category measure of regime type based on the Polity components. This new measure of regime type emerges as the most powerful predictor of instability onsets, leading us to conclude that political institutions, properly specified, and not economic conditions, demography, or …