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The MDS was founded by defectors from the then ruling [[Socialist Destourian Party]] (PSD) and liberal-minded expatriates in 1978. The founders of the MDS had already been involved in the establishment of the [[Tunisian Human Rights League]] (LTDH) in 1976/77.<ref name="Alexander46">{{Citation|first=Christopher|last=Alexander|title=Tunisia: Stability and Reform in the Modern Maghreb|publisher=Routledge|year=2010|page=46}}</ref> Its first secretary general was Ahmed Mestiri who had been a member of the PSD and interior minister in the government of [[Habib Bourguiba]], but was dropped from the government in 1971 and expelled from the party after he had called for democratic reforms and pluralism.
Tunisia was then a single-party state ruled exclusively by the PSD. The MDS remained illegal until 1981 when the more reform-minded Prime Minister [[Mohammed Mzali]] allowed oppositional parties to run candidates' lists in elections and announced to officially recognise them in case they won more than 5%. Among the minor, weakly institutionalised oppositional parties, the MDS presented the most appealing candidates{{cn}} list and threatened to actually beat the PSD in the capital Tunis.{{cn}} The government decided to rig the elections.{{cn}} So, according to official results, the MDS won only 3.2 percent, behind the ruling PSD with 94.6 percent.<ref>{{Citation|author=Alexander|title=Tunisia|year=2010|page=48}}</ref>
However, the government relented and allowed the MDS to officially register in 1983. It was one of three legal oppositional parties during the 1980s. The MDS welcomed [[Zine El Abidine Ben Ali]] taking over the presidency from the logterm head of state Bourguiba in 1987. Many MDS members believed that Ben Ali really pursued reforms and liberalisation and defected to his [[Constitutional Democratic Rally]] (RCD), weakening the MDS. Ahmed Mestiri led the party until 1990. In the early 1990s, the party was torn between cooperation with the government and opposition.<ref>{{Citation|first=Susan E.|last=Waltz|title=Human Rights and Reform: Changing the Face of North African Politics|publisher=University of California Press|year=1995|page=70}}</ref> Those who strove for a strictly oppositional course left the party or were edged out.<ref>{{Citation|author=Waltz|title=Human Rights and Reform|year=1995|page=185}}</ref> In 1994, a group of MDS dissidents around [[Mustapha Ben Jaafar]] founded the [[Democratic Forum for Labour and Liberties]] (FDTL), which was only legalised in 2002.
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