The Socialist Party won a plurality of votes, almost 35 percent, and legislative seats, and its leader Mário Soares became the Prime Minister of the 1st Constitutional Government on 23 July 1976.

The big surprise in the elections was the strong showing of the Democratic and Social Center (CDS), which polled ahead of PCP and gathered 16 percent of the votes.

[3] The case drew widespread international attention, and the PS started a full blown attack against the PCP and Prime Minister Vasco Gonçalves government.

He started facing big opposition from the so-called "reactionaries" (the Catholic Church, groups close to the former Estado Novo regime and, unofficially, from the PS, PPD and CDS.

), therefore, Vasco Gonçalves continued and forced his Democratic socialism policies with the nationalization of huge parts of the Portuguese economy.

[5] On 19 July 1975, the PS held a massive rally in Lisbon, with the help of the Catholic Church and others, to fight against the PCP and Vasco Gonçalves government.

Mário Soares, PS leader, accused the Gonçalves government, and those who support it, of being "Paranoids", "Demented" and "Irresponsibles who do not represent the Portuguese people".

[7] The violence and increased tensions across the country were damaging Vasco Gonçalves leadership in the government and divisions between the Armed Forces Movement and the Revolutionary Council were starting to show.

[8] Shortly after, on 26 September, the assault of the Spanish embassy in Lisbon by far-left supporters, in retaliation to the attacks on left-wing parties headquarters in the North and Center, drew widespread attention as it was broadcast by US network CBS.

The coup failed and shortly after a counter-coup led by Ramalho Eanes, a pro-democracy moderate, and supported by PS leader Mário Soares, re-established the democratic process.

During that year's summer, Prime Minister Mário Soares asked for a loan from the International Monetary Fund (IMF) and several austerity measures were implemented like the rise of interest rates, devalue of the Escudo and budget cuts.