In the 1989 local elections, the SHP emerged as the strongest party with 27.8 percent of the vote, winning in six metropolitan areas, 39 provinces, and 283 districts.

In the South Eastern Report published by the party in 1990 the problems of not acknowledging the Kurds as a distinct ethnic group were noticed.

In the coalition agreement, the SHP insisted on lifting the ban on pre-1980 parties which were dissolved by the military government.

On 6 June 1993, İnönü announced that he was planning to resign and Murat Karayalçın was elected as the new president of the party on 11 September 1993.

Former foreign minister Hikmet Çetin (SHP) became the interim chairman and the merged party chose the name of CHP after İnönü's suggestion.