The rapid pace of futures and options trading on exchange floors created by hundreds of traders actively participating in the determination of prices is perhaps the activity closest to classical perfect competition that can be observed in our economy. A reality often lost on the public, however, is that this trading is not based on a pure laissez-faire doctrine; futures markets have always been and will continue to be subject to substantial regulation. This article addresses some of the key institutional elements and current regulatory concerns of the futures and options (derivative instruments) markets.