Islam and Democracy

What relationship do Islam and democracy have to each other? Why are there presently so few democracies among Islamic-dominated states? Does the reason for this perhaps lie in the fact that Islam and democracy are irreconcilable opposites?
These questions are relevant not only for the Near East and North Africa, but also for Europe, where large numbers of Muslims have lived in democratic societies for more than sixty years. Most of them appreciate the freedoms and democratic structures that they experience there. At the same time a number of fundamentalistic Islamic groups are actively proclaiming that democracy is evil and autocratic regimes all over the Middle East are opposed to democracy. Though many intellectuals and young people are demonstrating for freedom rights, reform of Islam and democracy. Is a reform of Islam and Muslim majority societies in sight?