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The Lao Issara (“Free Laos”) was an anti-French, non-communist nationalist movement formed in 1945 by Prince Phetsarath. This short-lived movement emerged after the Japanese defeat in World War II and became the government of Laos before the return of the French. It aimed to prevent the French from restoring their control over Laos. The group disbanded in 1949.
 Independence given by the Japanese Authorities
Towards the end of the Japanese Occupation of Laos in 1945, when the Japanese were losing the war against the Allied Powers, the Japanese pressured the Lao King (Crown Prince Savang Vatthana) to declare the independence of Laos on 8 April.
Following the Japanese surrender on August 15th 1945, Prince Phetsarath made an attempt to convince King Savang to officially unify the country and declare the treaty of the French Protectorate invalid because the French had been unable to protect the Lao from the Japanese. However, King Savang said that he intended to have Laos resume its former status as a French colony.
In October 1945, supporters of Laotian independence announced the dismissal of the king and formed the new government of Laos, the Lao Issara, to fill up the power vacuum of the country.
 The weaknesses of the Lao Issara government
For six months, the Lao Issara government attempted to exercise its authority by establishing a defense force under the command of Phetsarath’s younger half-brother Souphanouvong, with the assistance from the Viet Minh government of Ho Chi Minh and the Chinese forces.
However, two events opened the way for the French reconquest of Laos: the modus vivendi agreed between Ho Chi Minh and the French government on 6 March 1946, and the agreement of withdrawal of Chinese forces. This left the Lao Issara government alone to fend for itself, and it became militarily weaker in comparison to the French.
Besides the inability to receive foreign aid, the Lao Issara was also crippled by other internal weaknesses.
The Lao Issara was a small urban-based movement, and was therefore unable to gain mass support from a tribal-oriented population. Its ideas of an independent Laos failed to appeal to the masses.
“As for the population, it was mostly silent, used to the established order and did not appear hardly concerned by this aspiration for the country’s independence, and personally I think that it was mostly loyal to the ancienne administration, that is to say, the French.” - Houmphanh Saignasith, the Secretary to the Minister of Economy
The Lao Issara also did not manage the finances of the country appropriately. The army itself incurred a high cost for its maintenance, and Souphanouvong refused to account for it. Within a very short period of time, the Issara government ran out of money to pay for its own running, let alone anything else. In an attempt to reign in fiscal expenditure and inflation, the Minister of Finance, Katay Don Sasorith, issued new money in early 1946, which quickly became known as ‘Katay’s dried banana leaves’ for the poor quality of the paper on which is was printed and its uselessness.
The Lao Issara, bankrupt and ill equipped, could only await the inevitable French return. At the end of April 1946 the French took Vientiane, by May they had entered Luang Prabang, and the Lao Issara leadership fled into exile in Thailand.
 The split within the Lao Issara
Once the reconquest was complete, the French set about reconstituting their administration in Laos. In 27 August 1946, the French formally endorsed the unity of Laos as a constitutional monarchy within the French Union.
There were also French efforts made at conciliation with the nationalists. Discreet overtures toward the Lao Issara in Bangkok suggested the possibility of an amnesty. Gradually, a division of opinion appeared within the Lao Issara ranks over the practical issue of whether to cooperate with the French.
Souphanouvong had made clear his refusal to accept the new political set-up in Vientiane, and was ready to embrace an alliance with the Viet Minh against the French. This repelled most of his colleagues, who began to oppose Souphanouvong’s leadership in the Lao Issara.
Besides this, unhappiness towards Souphanouvong became obvious due to his refusal to be accountable to the Issara government for his military activities and financial expenditure. There were personal antagonisms between Souphanouvong and Katay. Both of them exchanged harsh criticisms on one another as each thought the other to be ineffective in their positions.
On October 24 1949, due to the lack of cooperation within the movement, the Lao Issara announced its formal dissolution. On October 22, 1953, the Franco–Lao Treaty of Amity and Association transferred remaining French powers — except control of military affairs — to the Royal Lao Government, which did not include any representatives from the disbanded Lao Issara.
- Laos – Politics, Economics and Society by Martin Stuart-Fox
- Laos and Laotians by Meg Regina Rakow
- A Short History of Laos – The Land in Between by Grant Evans
- A History of Laos by Martin Stuart-Fox
- Laos – Keystone of Indochina by Arthur J. Donmen
- Uppsala Conflict Data Program (November 02, 2011). "Laos". Uppsala University Department of Peace and Conflict Research. Retrieved 11/11/02. "In October 1953, the Franco-Lao Treaty of Amity and Association transferred power...."