The impact of the 1922 defeat caused a number of chain reactions within the country with, prominent among them, the influx of refugees . The fall in middle class standards of living and the general discontent due to the course of national developments are reflected in the new orientation towards reformation and democratic parties founded during this period. A dominant role in these was played by figures that had left Venizelos' camp, which as time went by was losing its initial reformative impetus. Among them Alexandros Papanastasiou stands out, the statesman who principally associated his name with the establishment of the Republic in the inter-war period. The last government of Eleftherios Venizelos (1928-32) was the only government that had served out its full four-year parliamentary term in the inter-war period. Nevertheless, political instability revived more intensely after the end of its term of office. Extremist acts in the following years (an assasination attempt against Venizelos, successive coups by Venizelist army officers in 1933 and 1935), led the political life of the country into an even greater impasse. In November 1935 the constitution of the Republic was disrupted and King George II was restored to the throne through a coup by a group of army officers led by G. Kondylis.

A series of unfortunate coincidences at the beginning of 1936 (the death of Venizelos, the lack of leading figures) and the inertia of the political world gave Palace protégé Ioannis Metaxas the chance to style himself 'Governor' of the country, on the pretext that the country was running the risk of 'social revolution'.
The initial suspension of political freedom was followed by various persecutions of those considered ideologically and politically opposed to the new order - in other words, virtually the overwhelming majority of the Greek people. These measures, together with a number of practices that resembled recent events in Italy and Germany, gave the Regime a totalitarian (though not, in fact, Fascist) aspect. The Greek-Italian clash of 1940 and its painful consequences (German involvement that led to a tripartite occupation) interrupted the activities of the dictatorship. The developments in between moved the constitutional issue in Greece into a new phase.