Why are four-fifths of 45 Muslim-majority countries ruled by authoritarian regimes whereas only two-fifths of 193 countries in the world are autocracies? The paper analyzes this puzzle in two parts. The first part critically analyzes three alternative explanations of authoritarianism in Muslim-majority countries based on the a) alleged incompatibility of Islam and secularism, b) subordination of women, and c) difference between Arab and non-Arab Muslim-majority countries. The second part develops my own argument about the impacts of neighborhood effect and oil revenue on authoritarianism in the Muslim world. Neighborhood effects are very important for shifts from authoritarianism to democracy or vice versa as we saw in the examples of a) the rise of fascism before the World War II and democratization in its aftermath in Western Europe, b) the end of the military regimes in the late 1980s in Latin America, and c) the collapse of communism in the early 1990s in Eastern Europe. The paper argues that Muslim-majority countries should be analyzed as multiple geographical regions, rather than a monolithic geographical unit, to understand the high ratio of authoritarianism among them. There are two main regions that include entirely authoritarian Muslim-majority countries. These two regions have produced spillover effects and created vicious cycles of authoritarianism. One is the Middle East and North Africa (MENA). The other authoritarian region is Central and Southwest Asia (CSWA). Muslim-majority countries in other parts of the world (Europe, Southeast Asia, and Sub-Saharan Africa) include both electoral democracies (9) and autocracies (7), and thus their ratio of democracy (56 %) is almost the same of the world average (62 %). This paper explains why these two regions (MENA and CSWA) authoritarian by combining the effects of neighborhood and oil revenue. In other words, it will bridge the literatures on the impacts of geography and rentier economy. Majority of countries in MENA and CSWA regions are rentier states. Even the non-rentier states are under direct influence of the rentier economy that dominates the region through remittances and foreign debts. Moreover, non-rentier states are affected by the authoritarian mood of their rentier neighbors. In sum, the paper stresses that existence or absence of democracy in Muslim countries is a result of economic and geographic conditions rather than religious characteristics, gender relations, or ethnic identities.