Other forms: liberalized; liberalizing; liberalizes
Liberalize means to make more liberal––as in, less authoritarian and more open. State-run economies might liberalize by opening up industry, free enterprise, and trade.
Liberalize can also mean "reform." If you have a society that punishes theft by cutting off a culprit's hand, you could liberalize it by changing the punishment to jail time or other less cruel and unusual punishment.