Contemporary folk music refers to a wide variety of genres that emerged in the mid-20th century and afterwards which were associated with traditional folk music. Starting in the mid-20th century, a new form of popular folk music evolved from traditional folk music. This process and period is called the (second) folk revival and reached a zenith in the 1960s. The most common name for this new form of music is also "folk music", but is often called "contemporary folk music" or "folk revival music" to make the distinction. The transition was somewhat centered in the United States and is also called the American folk music revival. Fusion genres such as folk rock and others also evolved within this phenomenon. While contemporary folk music is a genre generally distinct from traditional folk music, it often shares the same English name, performers and venues as traditional folk music; even individual songs may be a blend of the two.

While the Romantic nationalism of the first folk revival had its greatest influence on art music, the "second folk revival" of the later 20th century brought a new genre of popular music with artists marketed through concerts, recordings and broadcasting. One of the earliest figures in this revival was Woody Guthrie, who sang traditional songs in the 1930s and 1940s as well as composing his own. Other major performers who emerged from the 1940s to the early 1960s included Pete Seeger, Bob Dylan, Joan Baez, Peter, Paul and Mary, Phil Ochs and Tom Paxton. In the UK, the folk revival fostered a generation of musicians such as Fairport Convention, Richard Thompson, Donovan, Martin Carthy, and Pentangle, who achieved initial prominence in the 1960s. The folk revival spawned Canada's first folk wave of internationally successful artists such as Neil Young, Gordon Lightfoot, Leonard Cohen, Joni Mitchell, and Buffy Sainte-Marie.

The mid-1960s through the early 1970s was associated with large musical, political, lifestyle, and counterculture changes. Folk music underwent a related rapid evolution, expansion and diversification at that same time. Major changes occurred through the evolution of established performers such as Bob Dylan, Joan Baez, Judy Collins, and Peter, Paul and Mary, and also through the creation of new fusion genres with rock and pop. During this period, the term "protest music" was often used to characterize folk music with topical political themes. The Canadian performers Gordon Lightfoot, Leonard Cohen, Bruce Cockburn and Joni Mitchell represented such fusions and enjoyed great popularity in the U.S. Starting in the 1970s folk music was fueled by new singer-songwriters such as Joni Mitchell, Neil Young, and Harry Chapin.

Other subgenres of folk include anti folk, folk punk, indie folk, folktronica, freak folk and Americana and fusion genres such as folk metal, progressive folk, psychedelic folk, and neofolk.

Definitions of "contemporary folk music" are generally vague and variable. Here, it is taken to mean all music that is called folk that is not traditional folk music, but rather, a set of genres that began with and then evolved from the folk revival of the mid-20th century. According to musician and singer-songwriter Hugh Blumenfeld, for the American folk scene, "it's not just about the music. The definitions are political, social, and economic as well as aesthetic. But if it can't be defined, we can at least describe what people who consider themselves folk music fans generally listen to." Though he considers folk music to be difficult to define, Blumenfeld lists some observed consistencies:

Beginning in the post World War II era, folk revivals occurred in Europe, Canada, and the United States, and developed through the 1960s, with the subject matter of this music influenced by the political and social climates of the day. According to The North American Folk Music Revival, "the folk music revival began... as a North Eastern American urban phenomenon, and spread from city to city throughout the entire continent and beyond, to Western Europe", with "enthusiasts" generally being middle-class university students. While instrumentation of folk music varies across countries and regions, music of the North American folk revival tended to use "acoustic guitar, harmonica, banjo, mandolin, autoharp, violin, and accordion".

While the Romantic nationalism of the folk revival had its greatest influence on art-music, the "second folk revival" of the later 20th century brought a new genre of popular music with artists marketed through concerts, recordings and broadcasting. This is the genre that remains as "contemporary folk music" even when traditional music is considered to be a separate genre. One of the earliest figures in this revival was Woody Guthrie, who sang traditional songs in the 1930s and 1940s as well as composing his own. Among Guthrie's friends and followers as a collector, performer, and composer was Pete Seeger.

Notable figures of the American folk revival include Elizabeth Cotten and Odetta. Cotten, a guitar and banjo player who developed the "Cotten style" of guitar fingerpicking, released her first album, Freight Train and Other North Carolina Folk Songs and Tune, in 1958 with the help of Mike Seeger, which also illuminates the use of guitars tuned to open keys, another common element found in folk music. Odetta, who is known for blending her operatic vocal background with blues and folk songs, was notably active in the Civil Rights Movement, which is reflected in her music. Both Cotten and Odetta performed at the first Newport Folk Festival.