Using the staggered adoption of universal demand (UD) laws in the United States, we study the effect of shareholder litigation risk on corporate disclosure. We find that disclosure significantly increases after UD laws make it more difficult to file derivative lawsuits against managers. Specifically, managers issue more earnings forecasts and voluntary 8-K filings and increase the length of management discussion and analysis (MD&A) in 10-K filings. We further assess the channels through which UD laws affect firms' disclosure policies. We find that the effect of UD laws on corporate disclosure is primarily driven by managers' reputation concerns and increased managerial entrenchment.