The article touches upon the approach of the modern Islamic legal thought to the Islamic state and caliphate. The author explains the fundamental principles of Islamic concept of the power (caliphate) and points out that this concept is gradually deviating from real political practice. The modern Islamic legal doctrine stresses several aspects of the classical theory of caliphate such as nature of Islamic power as an instrument for defense and maintaining of religion together with solving temporal issues, "ba'yat" institution which is a sort of oath for the ruler and a special treaty between him and his subjects about their mutual rights and duties and also the principle of consultation which is used during caliph's election. In the middle ages, the Ottoman Empire became the successor of the Arab caliphate. The caliphate itself remained as a political institution till the collapse of the Ottoman Empire after the World War I. The idea of the revival of caliphate was one of the demands included in the programs of some Islamic political organizations and movements during 20th century. After emergence of Islamic State of Iraq and Levant (ISIL) the caliphate converted to a specific political project. In June 2014, ISIL which changed its name to become "Islamic State" (IS) declared creation of caliphate. IS justified such step by referring to some wordings of Prophet Muhammad who, as believed, predicted revival of caliphate after a historical period when different modes of power were changing each other. IS considers its main goal to be the complete implementation of Sharia and copying power institutions of so called righteous caliphs. In practice, the Sharia implementation in IS leads to mass killings, forcing nonmuslims to adopt Islam, interference into internal life of Muslim states and terror attacks. The modern Islamic legal thought criticizes IS severely stressing its violence of religious postulates and Shariat provisions as far as the mode of announcing of Caliphate, "ba'yat" procedure and observance of consultation principle are concerned. This thought draws attention to the fact that IS practice doesn't meet Sharia limits. It concludes that IS cannot pretend to be caliphate as well as it is not Islamic power at all. This organization is terroristic not only according to the norms of international law and national legislation of a number of states but Sharia provisions.