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Is Brazil the largest country in South America?

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Yes, it is!

Is one of the biggest in world too. It total area is about 8,5140877 km² 3,287,597 sq mi and the the 5th biggest in world. Population in 2008 was estimated 190,467,249 person.

According to the Brazilian Constitution of 1988, Brazil is a federation of 26 states (estados), one federal district (Distrito Federal) and, also, the municipalities. None of these units have the right to secede from the Federation.

See this image of Brazil states 681px-Brazil_Labelled_Map.svg.png

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