This study explores the types and sources of decisions made by winning states toward defeated states focusing on territorial change after international conflicts. That is, it examines the impact of democracy on the settlement process of international conflicts and argues that due to their norm of respect for public sovereignty and consent democratic states as winners are less likely than non-democratic states to impose punitive peace on the defeated states. To test this argument this study analyzes a total of 260 cases of territorial change during the period from 1870-1992 using the ordered probit model. The empirical analysis shows that democratic winners are less likely to conquer or annex territory obtained from defeated states and more likely to construct a new political entity within that territory. The finding can contribute to the literature on democratic foreign policy and territorial change by connecting these two areas and showing how democratic norms and ideas can externalize in the settlement of international conflict via procedures of territorial change.