The one-term Liberal government of Premier Angus Bethune had collapsed following the withdrawal of support by Kevin Lyons.

The opposition Labor Party, led by Eric Reece, gained a clear majority and won the election.

On 15 March 1972, Lyons resigned as Deputy Premier and effectively dissolved the Liberal-Centre coalition.

The 1972 election was also notable due to the emergence and candidacy of the United Tasmania Group, the world's first Green party, formed to campaign against the proposed damming of Lake Pedder.

The United Tasmania Group gained a respectable 3.9% of the vote, failing to gain a seat in the parliament and to stop the damming of Lake Pedder, but their efforts paved the way for the Tasmanian Greens to become a significant force in Tasmanian politics.