This article studies the effect of dynamic demand response (DR) control on stability delay margins of load frequency control (LFC) systems including communication time delays. DR control is a significant tool to control the responsive loads and increase the reliability of LFC system. The DR control effort on the frequency regulation is provided to each control area of LFC system, called as LFC-DR system. Although the DR control provides some benefits to power grid, communication networks equipped in LFC systems cause communication time delays that degrade dynamic stability of the LFC systems resulting in exponential terms in the characteristic equation of LFC-DR system. This study utilizes an exact method to eliminate the exponential terms without any approximation and transform it into a regular polynomial. The method is utilized to identify stability delay margins for various proportional-integral gains and participation ratios of the secondary and DR control loops for the LFC-DR system. The delay margin values obtained are confirmed by time-domain simulations and a root finder algorithm based on quasi-polynomial mapping. Results indicate that the DR control significantly increases stability delay margins and improves the frequency response of the system as compared with conventional frequency regulation methods.