[1] The referendum was the outcome of Montenegrin President Momir Bulatović's decision to agree to the terms set by Lord Carrington which were to transform Yugoslavia into a loose association of independent states that would have the status of subjects under international law.

As the conflict in Croatia intensified, the European Community organized a peace conference on Yugoslavia in the Hague chaired by Lord Carrington, the former British Foreign Secretary who had served in Margaret Thatcher’s first cabinet.

Bulatović and Prime Minister Milo Đukanović, who supported him during the session, were decried as traitors by a series of speakers including Branko Kostić, as well as Serbian state media and Slobodan Milošević.

[11] In the run-up to the referendum, the two ruling parties in Serbia and Montenegro negotiated on the formation and distribution of power in the new Yugoslavia, left with around 40% of the territory and population of the previous country.

Throughout Montenegro, the ruling Democratic Party of Socialists campaigned under the slogan "Yugoslavia without alternative", and simultaneously worked towards limiting the scope for public debate, disrupting the activities of the opposition and implicitly threatening individuals with the potential loss of their livelihoods.

Its core argument was that the FRY was an unequal construction that would simply become dysfunctional, due to the fact that it was made up of two federal units of disproportionate size, population, and economic interests.

During the election campaign, Bulatović sought to continue to strike a balance between Montenegro’s political poles of unionism and nationalism, arguing in favor of Montenegrin autonomy and equality with Serbia within the FRY framework.

The DPS triumphed in the concurrent parliamentary election, and Milo Đukanović continued to serve as Prime Minister of Montenegro, eventually straying further still from the policies advocated by the Serbian leadership.