On August 31, 1994, after 25 years of fighting, the IRA declared an unconditional ceasefire, promising to suspend military operations in favour of peace talks. However, IRA disenchantment with the resulting negotiations led to a resumption of violence in 1996 and 1997, following its refusal to consider a surrender of arms as part of the negotiation process.  

The ceasefire cessation was marked by an explosion on February 9, 1996, at Canary Wharf, in London's Docklands, killing 2 people and injuring over 100, and by a bomb attack which devastated Manchester city centre on June 15, 1996. After Sinn Féin was included in the all-party Northern Ireland peace talks on September 15, 1997, the ceasefire was resumed. 

A number of IRA attacks in England and Northern Ireland in 1997 and 1998 are thought to be the work of a breakaway faction, Continuity IRA, and dissidents who left the IRA in October 1997. This fragmentation within the republican movement can be traced back to 1986, when Republican Sinn Féin and Continuity IRA were formed after Sinn Féin and the IRA voted to allow republicans to take seats in the Irish parliament.  

Several senior IRA members are understood to have considered defecting to Continuity IRA, which, with other groups such as the Irish National Liberation Army (INLA), is believed by the security forces to be a flag of convenience for the Provisional IRA. This belief is based on doubt that bombs and mortars with the latest technology used in attacks on the security forces in 1998 could not have been used without IRA sanction. The main reason for the split in the movement is the evidence that the IRA has rescinded some of its original immediate aims for a united Ireland and that the breakaway paramilitaries want to maintain the original programme. 

Sinn Féin may be barred from taking ministerial posts in the Northern Ireland devolved executive, to be set up under the Stormont agreement of Good Friday, April 10-which Sinn Féin accepted-if the IRA does not disarm first. IRA demands for early prisoner releases and Ulster ministerial posts for Sinn Féin will depend on the decommissioning of weapons, to be overseen by an International Commission on Arms. Following referendums held on May 22, in which majorities in the North and South voted in favour of the Stormont agreement, the commission head, General John de Chastelain, emphasised that the handing in of weapons would not be public or tantamount to surrender.  

An IRA statement in early May, insisting that no weapons would be handed over, was followed by one from the breakaway group threatening renewed attacks. The bomb attack in Omagh in August 1998 by the so-called Real IRA brought condemnation from the IRA itself, however, as well as from more mainstream figures. The IRA refused to accept the blueprint for arms decommissioning agreed between the British and Irish governments in April 1999.