In August 1923 the Republicans participated in the national elections, and public order was gradually restored. Neither Cumann na nGaedheal, the pro-Treaty party founded by Cosgrave in April 1923, nor the reformed republican Sinn Féin secured a majority in the August elections. 

Cosgrave retained power, however, and De Valera led the republicans in a boycott of the Dáil. Cosgrave put together a viable government, which reached an agreement with the United Kingdom on some mutual problems and strengthened the economy by a series of measures, including a hydroelectric project at Ardnacrusha on the River Shannon. 

In December 1925 the Boundary Commission was abandoned after the chairman's findings were leaked to the press, and instead a tripartite agreement was reached confirming the existing border. 

The Irish Free State had joined the League of Nations in September 1923, and the following year it issued its own passports and set a precedent for members of the Commonwealth of Nations by sending its own ambassador to Washington, DC.

At the Imperial Conference of 1926, the Free State joined with other dominions to obtain the Balfour Report, which stated that the British government would not legislate for the dominions or nullify acts passed by their own legislatures. Once this was confirmed by the Statute of Westminster in 1931, Ireland had the power to legislate away its relationship with the United Kingdom.