1977年2月，門格斯圖·海爾·馬亞姆(MENGISTU HAILE MARIAM)中校動軍事政變，擔任"臨時軍事行政委員會"主席和國元首。1979年，成立以軍人為主的"埃塞俄比亞勞動人民組織委員會"，實行一節制制度。1984年，按共模式組成"埃塞俄比亞工人"。1987年9月，門格斯圖宣佈解散"臨時軍事行政委員會"，結束軍事統治，成立"埃塞俄比亞人民民主共和國"，建立新議會，門擔任國總統和政府首腦。
1988年3月，反政府武裝活動的"厄立特亞人民解放陣綫"(EPLF)和"提格雷人民解放陣綫"(TPLF)政府軍動進攻，大規模內戰爆。1989年，"厄立特亞人民解放陣綫"占領厄省大部。1991年5月28日，以"提格雷人民解放陣綫"為主的埃革陣軍隊進入亞的斯亞貝巴，門格斯圖政權宣告瓦解。
In July 1977, sensing the disarray in Ethiopia, Somalia attacked across the Ogaden in pursuit of its irredentist claims to the ethnic Somali areas of Ethiopia (see Ogaden War). They were assisted in this invasion by the armed Western Somali Liberation Front. Ethiopian forces were driven back far inside their own frontiers but, with the assistance of a massive Soviet airlift of arms and Cuban combat forces, they stemmed the attack. The last major Somali regular units left the Ogaden March 15, 1978. Twenty years later, the Somali region of Ethiopia remains under-developed and insecure.
From 1977 through early 1978, thousands of suspected enemies of the Derg were tortured and/or killed in a purge called the "red terror". Communism was officially adopted during the late 1970s and early 1980s; in 1984, the Workers' Party of Ethiopia (WPE) was established, and on February 1, 1987, a new Soviet-style civilian constitution was submitted to a popular referendum. It was officially endorsed by 81% of voters, and in accordance with this new constitution, the country was renamed the People's Democratic Republic of Ethiopia on September 10, 1987, and Mengistu became president.
The regime's collapse was hastened by droughts and famine, which affected around 8 million people, leaving 1 million dead, as well as by insurrections, particularly in the northern regions of Tigray and Eritrea. In 1989, the Tigrayan Peoples' Liberation Front (TPLF) merged with other ethnically-based opposition movements to form the Ethiopian Peoples' Revolutionary Democratic Front (EPRDF). In May 1991, EPRDF forces advanced on Addis Ababa. Mengistu fled the country to asylum in Zimbabwe, where he still resides.