In 1893 Zelaya came to power through a successful Liberal revolt that ended 30 years of Conservative dominance. In 1906 he refused to send delegates to the San José conference convened for the purpose of maintaining peace in Central America; instead he invaded Honduras, overthrowing its government, and then tried to start a revolution in El Salvador. His efforts brought the area to the verge of war, prompting both Mexico and the United States to intervene. The Washington Conference of 1907 ensued, at which all five Central American states signed an agreement pledging to maintain peace among themselves. Zelaya, however, quickly broke the treaty.

Zelaya's attitude was based on his fear of U.S. economic domination and of the alleged U.S. intention to separate Nicaragua's eastern coast from the rest of the country. In 1909 the U.S. government supported a Conservative effort to unseat Zelaya; and when, in December of that year, the dictator executed U.S. soldiers of fortune for serving in the revolutionary army, the United States broke off diplomatic relations. Early in 1910 Zelaya was finally forced to flee to Mexico.