This article explains why the conflict over Nagorno-Karabakh escalated into full-scale ethnic warfare in the late 1980s and early 1990s. The article uses newly available sources to test the explanatory value of recent theories of conflict and strategic uncertainty. The evidence shows that in the summer of 1991 the Armenian separatist movement in Nagorno-Karabakh offered the Azerbaijani authorities virtual capitulation in exchange for a cessation of the offensive initiated against the region in the preceding spring. Because a more radical Armenian leadership gained the upper hand in Nagorno-Karabakh, and because the coup attempt in Moscow in August 1991 distracted Soviet leaders, the conflict soon became a full-fledged war.

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