Explain the negative and positive impact of democracy.

Democracy has been in existence for approximately 2500 years and has been implemented in a wide range of manners in different cultures. Thus, one cannot talk about positive and negative impacts in global fashion but only in terms of how democracy may have had positive and negative impacts on specific cultures in specific periods. 
If one looks at the ancient Athenian democracy, one can see both positive and negative elements. First, one should note that like many democracies, it had a limited franchise, meaning that only free male citizens could vote. Even this limited franchise meant that government was more responsive to the will of the people and that people enjoyed a greater degree of freedom and say in the formation of laws than was the case in earlier governments. Oratory and rhetoric flourished, with democracy leading to greater civic engagement and a vital public sphere. These are often held to be general virtues of democracy.
The negative side to democracy is that it can lead to mob rule and demagogues pandering to people's worst impulses. It was the Athenian democracy that, in the Melian debate, wanted to execute all the men on the island of Melos and enslave all the women and children. Democracies can oppress unpopular minorities and silence dissenting voices. It was the Athenian democracy that sentenced Socrates to death. Also, democracies may elect people on the basis of popularity rather than skill, leading the government to bad decision-making.