The Word Liberal.

I have heard the word liberal more times then I could have ever imagined since I started attending the University of North Texas. I have heard it in good and bad context and am quite confused on how some people tend to use this word.
For some the word liberal is a "bad word" and will spark anger when used. Then there are some who would prefer to be called nothing else. The question I have is "what is a liberal", and does it have anything to do with republicans and democrats?
Well, this is the definition i have found from "Dictionary.com- Liberal - favorable to or in accord with concepts of maximum individual freedom possible, esp. as guaranteed by law and secured by governmental protection of civil liberties. So, why does the word have such a stigma if it means the favor of maximum individual freedom possible? Because of polarization, in our political agenda we as a country have a tendency to use slander to promote your own views. This is an extremely bad situation that i believe we should address immediately.
If this is the definition of a liberal, would you not consider yourself one?