The Panama held a general election on May 12, 1968, electing both a new President of the Republic and a new National Assembly.
The election took place on May 12, 1968, as scheduled, and tension mounted over the succeeding eighteen days as the Election Board and the Electoral Tribunal delayed announcing the results. Finally the Election Board declared that Arnulfo Arias had carried the election by 175,432 votes to 133,887 for David Samudio Ávila and 11,371 for Antonio González Revilla. The Electoral Tribunal, senior to the Board and still loyal to the President Marco Aurelio Robles, protested, but the commander of the National Guard, Brigadier General Bolívar Vallarino, despite past animosity toward Arias, supported the conclusion of the Board.
Arnulfo Arias was declared the winner on May 30.
Arias took office on 1 October, demanding the immediate return of the Canal Zone to Panamanian jurisdiction and announcing a change in the leadership of the National Guard. He attempted to remove the two most senior officers, Bolívar Vallarino and Colonel José María Pinilla, and appoint Colonel Bolívar Urrutia to command the force.
On 11 October the Guard, for the third time, removed Arnulfo Arias from the presidency. With seven of his 8 ministers and 24 members of the National Assembly, Arias took refuge in the Canal Zone.
The overthrow of Arnulfo Arias provoked student demonstrations and rioting in some of the slum areas of Panama City. The peasants in Chiriquí Province battled guardsmen sporadically for several months, but the Guard retained control. Bolívar Urrutia was initially arrested but was later persuaded to join in the two-man provisional junta headed by José María Pinilla. Bolívar Vallarino remained in retirement. The original cabinet appointed by the junta was rather broad based and included several David Samudio Ávila supporters and one Arias supporter. After the first three months, however, 5 civilian cabinet members resigned, accusing the new government of dictatorial practices.