The Dictatorship of the Proletariat in Marxism is a state in which the working class, rather than the elite, has political power. It is not dictatorship in the sense of being ruled by a despot, such as Hitler or Stalin, rather, the rule of a class. The United States is not truly a democracy, since the rich control the media and finance political campaigns, therefore rich people have too much influence. For these reasons Marxists feel, the Dictatorship of the Proletariat is actually, in a way, closer to democracy.
Unfortunately, for the Soviet Union, the working people ended up being ruled under a corrupt, undemocratic bureaucracy, probably due to the takeover of Stalin. Leon Trotsky viewed the Soviet Union as a "degenerated workers' state" which would eventually either degenerate into a capitalist class, or be overthrown by a political revolution. Other nations were modeled after the Soviet Union's bureaucratic dictatorship, rather than a democratic organization of the proletariat.
Criticism of the concept
"The Dictatorship of the Proletariat is not rule by a Hitler or Stalin, but rather, the rule of a class. For this reason, it is actually, in a way, a form of democracy." - ? Actually, yes; it would be the purest form of democracy - rule by "the mob", or ? mass crowds - but I don't see how this ? would make a good thing, even in theory. Presumably, what one wants is a? republic - a system which is ruled for the sake of the public as a whole - which is emphatically? not? what the "Dictatorship of the Proletriat" is, as this focus solely on the economically dis-empowered as if mankind's entire destiny lied within them (the key mistake Marx made). What would make more sense, would be to empower the laboring class in such a way that the capitalist class sees it to their own gain to empower them further, so that the public as a whole flourishes, rather than landing us in a stagnant "utopia" for the sake of vindicating dispriviledged segment alone.