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The phrase outsourcing war has been used since the late 1990s to describe the trend toward the hiring of private military and security companies (PMSCs) by national governments to perform functions that previously had been assigned only to members of national military forces. These private companies, in turn, hire employees, usually on limited-term contracts, to carry out the missions that the companies have agreed to accomplish. PMSCs may undertake combat missions independently or in direct cooperation with deployed national military forces. They may be assigned to security missions in secret or to meet a highly visible demand, as in the case where the United States contributed private military contractors to the United Nations peacekeeping force in Kosovo in 1998. This was an early case in which privately contracted military employees were hired by one nation to function cooperatively with uniformed members of other national military forces. During the 20th century, private military forces had been considered a form of organized crime populated by mercenaries, a delinquent group at the fringes of the social order who traded in violence to advance the interests of anyone willing to pay them. By the beginning of the 21st century, however, the outsourcing of war and security functions to private companies had become commonplace, transforming the previously prevailing belief that only states had the right to wage war. States often deployed their militaries alongside PMSCs who were contracted to provide support to forces on the ground. In other cases, private companies would pay representatives of other private companies to defend their assets, such as oil fields or diamond mines. During this period at the turn of the 21st century, PMSCs came to be perceived as representatives of a legitimate industry. With this transformation, the nature of security and modern conflict changed as well. Private military and security companies became an important instrument in war-making and the projection of power.

While early private military and security companies (PMSCs) were likened to mercenaries, as of the 21st century, PMSCs have become regular actors in many nations and conflicts. Typically organized as legal corporate entities, they provide a wide range of military and security services, including transport, logistics, and maintenance to military and police training, demining, intelligence, risk analysis, armed and unarmed protective services, antipiracy measures, border protection, drones, and cyber operations. Not only have PMSC services diversified since the 1990s but so has their client base. Industrialized countries, autocratic regimes, failed states, international organizations, transnational corporations, and even humanitarian organizations hire PMSCs. There are several explanations for the rise of the industry. Functional explanations see the proliferation of PMSCs as a rational response to military capability gaps and increased demand for international security. Ideational and constructivist approaches attribute the outsourcing of military and security services to changing beliefs and norms about the appropriate relationship between states and markets. The consequences of using PMSCs for accountability, effectiveness, control, gender and racial equality, the location of political authority, and the provision of public and private security in conflict environments are key areas of research, as is the question of suitable forms of regulation for the industry, ranging from national and international laws to industry self-regulations, multistakeholder initiatives, and standard setting schemes. Finally, the privatization of military and security services raises concerns about a fundamental transformation in modern warfare.