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During the last three decades, Nicaragua posed three of the most difficult challenges faced by US foreign policy-makers in the third world: how to cope with a declining, repressive, but previously friendly dictator? how to relate to an anti-American revolutionary government? how to facilitate a democratic transition? The Nicaraguan challenge was to establish a democratic and autonomous government, with as much support and as little interference as possible from the great powers. This book demonstrates how an unproductive interaction led to both sides worst nightmares. Through the fall of Anastasio Somoza, the rise of the Sandinistas, and the contra war, the United States and Nicaragua seemed destined to repeat the mistakes made by the US and Cuba forty years before. The 1990 election in Nicaragua broke the pattern. Robert Pastor was a major US policymaker in the critical period leading up to and following the Sandinista Revolution of 1979. A decade later after writing the first edition of this book, he organized the International Mission led by Jimmy Carter that mediated the first free election in Nicaraguas history. From his unique vantage point, and utilizing a wealth of original material from classified government documents and from personal interviews with US and Nicaraguan leaders, Pastor shows how Nicaragua and the United States were prisoners of a tragic history and how they finally escaped. This revised and updated edition covers the events of the democratic transition, and it extracts the lessons to be learned from the past.