A variety of direct democratic instruments allow “policy-making at the ballot box” (Gerber, 1999, p. 3), with the citizens having the last word on policy adoption and change. Criteria for the classification of direct democracy devices include who initiates a popular vote, who has control over the content of the proposal, whether it addresses statutory or constitutional law, or whether the result is binding or not. Interest groups use two main direct democracy instruments to influence policy-making: the initiative to put a new policy issue on the political agenda and the referendum to veto a policy adopted by the legislature. This chapter scrutinizes the effects of these tools on the policy process, on policy outputs, and on interest group populations. It shows that citizen groups benefit more than business groups from the initiative and referendum.