The Easter Rising of 1916, and particularly the execution of fifteen people by firing squad, the imprisonment or internment of hundreds more, and the imposition of martial law, caused a profound shift in public opinion towards the republican cause in Ireland. Meanwhile, opposition increased to Ireland's participation in World War I in Europe and the Middle East. This came about when the Irish Parliamentary Party supported the Allied cause in World War I in response to the passing of the Third Home Rule Bill in 1914. Many people had begun to doubt whether the Bill, passed by Westminster in September 1914, but suspended for the duration of the war, would ever come into effect. Due to the war situation deteriorating badly on the Western Front in April 1918, which coincided with the publication of the final report and recommendations of the Irish Convention, the British Cabinet drafted a doomed "dual policy" of introducing Home Rule linked to compulsory military service for Ireland which it eventually had to drop. Sinn Féin, the Irish Party, and all other Nationalist elements joined forces in opposition to the idea during the Conscription Crisis of 1918. At the same time, the Irish Parliamentary Party lost in support on account of the crisis. Irish republicans felt further emboldened by successful anti-monarchical revolutions in the Russian Empire (1917), the German Empire (1918), and the Austro-Hungarian Empire (1918). In the December 1918 General Election, Sinn Féin won a large majority of the Irish seats in the Westminster parliament of the United Kingdom of Great Britain and Ireland: 73 of the 105 constituencies returned Sinn Féin members (25 uncontested). The Sinn Féin party, founded by Arthur Griffith in 1905, had espoused non-violent separatism. Under Éamon de Valera's leadership from 1917, it campaigned aggressively and militantly for an Irish republic.
On 21 January 1919, Sinn Féin MPs (who became known as Teachta Dála, TDs), refusing to sit at Westminster, assembled in Dublin and formed a single-chamber Irish parliament called Dáil Éireann (Assembly of Ireland). It affirmed the formation of an Irish Republic and passed a Declaration of Independence, calling itself Saorstát Éireann (Irish Free State) in Irish Gaelic:
"...the Irish people is resolved... to promote the common weal, to re-establish justice... with equal rights and equal opportunity for every citizen."
Although the less than overwhelming majority of Irish people accepted this course, America and Soviet Russia were targeted to recognize the Irish Republic internationally. The Message to the Free Nations of the World called on:
"...every free nation to support the Irish Republic by recognizing Ireland's national status... the last outpost of Europe towards the West... demanded by the Freedom of the Seas."
Cathal Brugha, elected President of the Ministry Pro-Tem, warned, "Deputies you understand from this that we are now done with England."
War for a new independent Ireland
The War of Independence (1919–1921) pitted the army of the Irish Republic, the Irish Republican Army (known subsequently as the "Old IRA" to distinguish it from later organisations of that name), against the British Army, the Black and Tans, the Royal Irish Constabulary, the Auxiliary Division, the Dublin Metropolitan Police, the Ulster Special Constabulary and the Ulster Volunteer Force. On 9 July 1921 a truce came into force. By this time the Ulster Parliament had opened, established under the Government of Ireland Act 1920, and presenting the republican movement with a fait accompli and guaranteeing the British permanent entanglement in Ireland. On 11 October negotiations opened between the British Prime Minister, David Lloyd George, and Arthur Griffith, who headed the Irish Republic's delegation. The Irish Treaty delegation (Griffith, Collins, Duggan, Barton, and Gavan Duffy) set up headquarters in Hans Place, Knightsbridge. On 5 December 1921 at 11:15 am the delegation decided during private discussions at 22 Hans Place to recommend the negotiated agreement to the Dáil Éireann; negotiations continued until 2:30 am on 6 December 1921, after which the parties signed Anglo-Irish Treaty.
Nobody had doubted that these negotiations would produce a form of Irish government short of the independence wished for by republicans. The United Kingdom could not offer a republican form of government without losing prestige and risking demands for something similar throughout the Empire. Furthermore, as one of the negotiators, Michael Collins, later admitted (and he would have known, given his leading role in the independence war), the IRA at the time of the truce was weeks, if not days, away from collapse, with a chronic shortage of ammunition. "Frankly, we thought they were mad", Collins said of the sudden British offer of a truce – although the republicans would probably have continued the struggle in one form or another, given the level of public support. Since Lloyd George had already, after the truce had come into effect, made it clear to President of the Republic, Éamon de Valera, "that the achievement of a republic through negotiation was impossible", de Valera decided not to become a member of the treaty delegation and so not to risk more militant republicans labelling him as a "sellout". Yet his own proposals – published in January 1922 – fell far short of an autonomous all-Ireland republic. Sinn Féin's abstention was unambiguous.
As expected, the Anglo-Irish Treaty explicitly ruled out a republic. It offered Ireland dominion status, as a state within the then British Empire – equal to Canada, Newfoundland, Australia, New Zealand and South Africa. Although less than expected by the Sinn Féin leadership, this deal offered substantially more than the initial form of home rule within the United Kingdom sought by Charles Stewart Parnell from 1880, and represented a serious advance on the Home Rule Bill of 1914 that the Irish nationalist leader John Redmond had achieved through parliamentary proceedings. However, it all but confirmed the partition of Ireland between Northern Ireland and the Irish Free State. The Second Dáil in Dublin ratified the Treaty (7 January 1922), splitting Sinn Féin in the process.
Arthur Griffith addressing the Dail on 14 December 1921 said "Well, we have brought back Irish freedom and Irish independence ... Ireland is as free as Canada and Australia". Speaking in Dail Eireann on 21 September 1922, Gavan Duffy TD, one of the signatories of the treaty, stated: "The Governor-General will have to do exactly as he is told by Dominion Ministers, and it is proposed, and warmly advocated, that he should cease altogether to be the representative of Great Britain. Let him represent the Imperial Crown, but let Great Britain send Ambassadors to her Dominions, as she does to other countries, because they are in fact independent countries voluntarily uniting themselves with Great Britain and not a gang of subject States."