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Dutov was born in Kazalinsk in Syr-Darya Oblast (now Kazaly in Kazakhstan). He graduated from Nikolayev cavalry School, and Nikolayev Engineering Institute, now Military engineering-technical university (Russian Военный инженерно-технический университет), and General Staff Academy (1908). He was Assistant Commander of the Cossack regiment during World War I. After the February Revolution, Dutov was appointed head of the All-Russian Cossack Army Union, then Chairman of the counterrevolutionary All-Russian Cossack Congress (June, 1917), and then Chief of the Army Administration and ataman of the Orenburg Cossack Army (September).
In November, Dutov raised a revolt against the Soviet authorities in Orenburg. In June 1918, Dutov with the help of the Czech Legion organized a struggle for complete termination of the Soviet authority in the Urals. He was in charge of the Detached Orenburg Army in Aleksandr Kolchak's army.
In 1919 he tried to convince General Grigory Semyonov to join him as a stronger force to fight the Red Army. Semyonov refused despite a significant diplomatic effort from Governor Vasile Balabanov claiming he was governor only since the provisional government in St Petersburg collapsed in the revolution.