The period between Paul Martin's assumption of the leadership of the Liberal Party of Canada on November 14, 2003, and the 2004 Canadian election being called on May 23, 2004, saw a large amount of infighting within the party.

Traditionally the Liberals have been the most unified of Canada's major parties. The Progressive Conservatives would implode regularly, having done so under John Diefenbaker, Joe Clark, and Brian Mulroney, and the Canadian Alliance did so under Stockwell Day, but the Liberals had traditionally seen heated but soon forgotten leadership contests that did not harm party unity. A notable exception was the period after John Turner was elected leader.

Many pundits have dated the current split to that earlier era arguing that there is a clear division between the socially progressive, nationalist, and federalist wing of the party represented by Pierre Trudeau and Jean Chrétien and the fiscally conservative, pro-business wing of John Napier Turner and Paul Martin.

When the Liberals formed a majority government after the 1993 election with Chrétien at the helm, party unity was assured by placing Martin, whom Chrétien had defeated for the party leadership in 1990, in the crucial role of Minister of Finance.

Martin worked hard to become the clear successor to Chrétien, ensuring that most of the institutions of the Liberal Party were controlled by his allies. The split opened wider, however, in the summer of 2003 when Chrétien tried to curtail Martin's open campaigning for the leadership. What ensued is of some debate. Martin claims that he was fired from cabinet by Chrétien, which is what was widely reported in the media, while Chrétien claims that Martin had resigned. In either case, Martin's influence in the party eventually forced Chrétien to announce his retirement and in December Martin took over.

While the issue of the party leadership was settled, at the lower levels unprecedented intraparty warfare began. Most of Chrétien's loyal cabinet ministers were relegated to the backbenches. Ministers such as John Manley, Allan Rock, Don Boudria, Sheila Copps, and Stephane Dion who had spent a decade running one of the most popular and successful governments in Canadian history were reduced to minor roles, and many of them decided to leave politics for the private sector.

Some Chrétien loyalists refused to retire, hoping to remain as backbenchers. The Martin Liberals arranged to defeat some of them in riding nomination battles. Unlike in previous elections incumbent Liberals were not backed by the party. Rather in many cases challengers received unofficial support from the Martinites.

Nomination battles

The highest profile battle was in the riding of Hamilton East—Stoney Creek between former Deputy Prime Minister and leadership candidate Sheila Copps and Martin loyalist and newly minted cabinet minister Tony Valeri. Copps was one of the most noted representatives of the party's left wing and had been a leading Liberal for decades, but lost the nomination battle, which she blamed on dirty tricks.

Other battles happened across the country:

• Charles Caccia, the longest serving MP, was forced out by Martin loyalist Mario Silva; Caccia initially ran as an independent candidate against Silva, but bowed out of the race before the election because his candidacy may have split the Liberal vote.
• In the merged riding of Mississauga—Erindale , Chrétien loyalist Steve Mahoney lost to Martinite Carolyn Parrish.
• In Ottawa Centre, heir apparent Penny Collenette was beaten by Martin advisor Richard Mahoney.
• Ottawa South opponents of David McGuinty, brother of Ontario premier Dalton McGuinty, were allegedly given only three days to recruit voters.
• Incumbent Eugène Bellemare lost the Ottawa—Orléans nomination to Marc Godbout
• Incumbent Ivan Grose lost the Oshawa nomination to Louise Parkes
• In the merged riding of Welland, Tony Tirabassi was defeated by John Maloney
• Incumbent Joe Peschisolido, a Martin supporter, lost the Richmond nomination to Raymond Chan. (Note: Peschisolido had been elected as a Canadian Alliance MP, but crossed the floor to the Liberals in 2003, and thus didn't have a true base of support within the Liberal party.)
• In Burnaby—Douglas , Martin supporter Bill Cunningham , a former LPCBC President, was directly appointed by the party leader without allowing a vote; the entire riding association executive resigned in protest.
• Steven Hogue , a Chrétien supporter, was disallowed from running in Chrétien's former riding of Saint-Maurice—Champlain purportedly because Martin wanted women to be nominated in winnable ridings in Quebec;
• Lisette Lepage is forced to run in Bloc stronghold Charlevoix—Montmorency because she (as well as two other women) were denied the chance to run in the Liberal-safe riding of Beauport as it was reserved for Martin loyalist Dennis Dawson
• After Martin appoints Ruby Dhalla over local candidates in Brampton—Springdale, the Liberal riding association decides to back NDP candidate Kathy Pounder