Contexts of Theonomy

Theonomy is a tough word to pin down. Don't some use it to mean a society governed by God's law, or the eschaton ruled by God's law or will as people understand it including teleology? Doesn't it mean more than simply the legalistic social environment and works of traditional first century Jews or better yet, Muslims today living by Sharia? Tillich wrote about theonomy within an existential context, and that wasn't totally plain to me. Jesus has laws of conduct for people to live by in faith comprising Christian ethics, yet for argumentative purposes, say social conduct is entirely grace without temptations arising and with people as virtual automatons with salvation programming installed-isn't that still a God's law (equivalent to his will in some respects) environment of theonomy (where God rules). So that is what theonomy is perhaps-a place where God rules and one is aware of that and chooses to obey rather than sin?