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The Labour Party became a major political force during the 1920s. It unexpectedly entered office as a minority government in 1924; five years later as the largest party in the Commons it took office again. For many the party's enhanced status was associated closely with its leader, Ramsay MacDonald. The years of optimism were destroyed by rising unemployment; in August 1931, the second Labour Government faced pressures for public expenditure cuts in the midst of a financial crisis. The Government collapsed, and MacDonald led a new administration composed of erstwhile opponents and a few old colleagues. Labour went into opposition; an early election reduced it to a parliamentary rump. This study offers a uniquely detailed analysis of Labour in the 1920s based on a wide variety of unpublished sources. The emphasis is on the variety of identities available within the party, and demonstrates how disputes over identity made a crucial contribution to the 1931 crisis. Thorough scholarship and distinctive interpretation combine to provide an important examination of a major episode in twentieth-century history.