The noun polity refers to a political group of any size or shape — it can be a government, a state, a country, or even a social group.
When you hear the word polity, think politics and you're on the right track. The prefix for polity dates all the way back to Greece, from the word politeia, which means "citizenship" or "government." Any group run by politics can be called a polity. The Democratic Party is a polity, but hopefully your birthday party isn't.