In this paper we identify the superposition principle as a main source of problems in QM (measurement, collapse, non-locality etc.). Here the superposition principle for individual systems is substituted by the antisuperposition principle: no non-trivial superposition of states is a possible individual state (for ensembles the superposition principle is true). The modified QM is based on the anti-superposition principle and on the new type of probability theory (Extended Probability Theory [1]), which allows the reversible Markov processes as models for QM. In the modified QM the measurement is a process inside of QM and the concept of an observation of the measuring system is defined. The outcome value is an attribute of the ensemble of measured systems. The collapse of the state is substituted by the Selection process. We show that the derivation of Bell’s inequalities is then impossible and thus QM remains a local theory. Our main results are: the locality of the modified QM, the local explanation of EPR correlations, the non-existence of the wave-particle duality, the solution of the measurement problem. We show that QM can be understood as a new type of the statistical mechanics of many-particle systems.