The election was called unexpectedly in early 1988, after disgruntled NDP backbencher Jim Walding voted against his government's budget on March 9, 1988.

As the budget vote was a confidence measure, the Pawley ministry was forced to resign and call new elections two years ahead of schedule.

Popular support for the NDP was at an historically low level when the election was called, due to soaring Autopac rates and a taxpayer-funded bailout of the Manitoba Telephone System.

The Progressive Conservatives, led by Gary Filmon, ran on a platform of saving revenue by selling public corporations, including ManOil and Manfor.

The NDP, which retained a support base in the north of the province, promised to create northern training centres in Thompson and The Pas.

Although Filmon was personally anti-abortion, the Progressive Conservatives were unwilling to propose specific action on the subject, and withdrew from an early promise to close Henry Morgentaler's private clinic.

The Progressive Conservatives entered the election with a significant lead in the polls, but saw their support undercut by the Liberals in the campaign's final weeks.

In terms of the popular vote, the Progressive Conservatives actually lost support from the last election, however they dominated the rural southern portion of the province, a traditional Tory stronghold.

The New Democrats managed to retain four seats in Winnipeg, five in the north, the mid-northern ridings of Dauphin and Interlake, and Brandon East in the south of the province.