In April 1918, the British Cabinet, in the face of the crisis caused by the German Spring Offensive, attempted with a dual policy to simultaneously link the enactment of conscription into Ireland with the implementation of Home Rule, as outlined in the report of the Irish Convention of 8 April 1918. This further alienated Irish nationalists and produced mass demonstrations during the Conscription Crisis of 1918. In the 1918 general election Irish voters showed their disapproval of British policy by giving Sinn Féin 70% (73 seats out of 105,) of Irish seats, 25 of these uncontested. Sinn Féin won 91% of the seats outside of Ulster on 46.9% of votes cast, but was in a minority in Ulster, where unionists were in a majority. Sinn Féin pledged not to sit in the UK Parliament at Westminster, but rather to set up an Irish Parliament. This parliament, known as the First Dáil, and its ministry, called the Aireacht, consisting only of Sinn Féin members, met at the Mansion House on 21 January 1919. The Dáil reaffirmed the 1916 Proclamation with the Irish Declaration of Independence,[13] and issued a Message to the Free Nations of the World, which stated that there was an "existing state of war, between Ireland and England". The Irish Volunteers were reconstituted as the "Irish Republican Army" or IRA. The IRA was perceived by some members of Dáil Éireann to have a mandate to wage war on the British Dublin Castle administration.

In May 1921, Ireland was partitioned under British law by the Government of Ireland Act, which created Northern Ireland. Both sides agreed to a ceasefire (or 'truce') on 11 July 1921.  The post-ceasefire talks led to the signing of the Anglo-Irish Treaty on 6 December 1921. This ended British rule in most of Ireland and, after a ten-month transitional period overseen by a provisional government, the Irish Free State was created as a self-governing Dominion on 6 December 1922. Northern Ireland remained within the United Kingdom. After the ceasefire, violence in Belfast and fighting in border areas of Northern Ireland continued, and the IRA launched a failed Northern offensive in May 1922. In June 1922, disagreement among republicans over the Anglo-Irish Treaty led to the ten-month Irish Civil War. The Irish Free State awarded 62,868 medals for service during the War of Independence, of which 15,224 were issued to IRA fighters of the flying columns.[12]