As World War II approached, the SDF assumed the mission of guarding Sudan's frontier with Italian East Africa (present-day Ethiopia). During the summer of 1940, Italian forces invaded Sudan at several points and captured Kassala. However, the SDF prevented a further advance on Port Sudan. In January 1941, the SDF, expanded to 20,000 troops, retook Kassala and participated in the British offensive that routed the Italians in Eritrea and liberated Ethiopia. Some Sudanese units later contributed to the British Eighth Army's North Africa victory.

In the immediate postwar years, the condominium government made a number of significant changes. In 1942 the Graduates' General Conference, a quasi-nationalist movement formed by educated Sudanese, presented the government with a memorandum that demanded a pledge of self-determination after the war to be preceded by abolition of the "closed door" ordinances, an end to the separate curriculum in southern schools, and an increase in the number of Sudanese in the civil service. The governor general refused to accept the memorandum but agreed to a governmentsupervised transformation of indirect rule into a modernized system of local government. Sir Douglas Newbold, governor of Kurdufan Province in the 1930s and later the executive council's civil secretary, advised the establishment of parliamentary government and the administrative unification of north and south. In 1948, over Egyptian objections, Britain authorized the partially elected consultative Legislative Assembly representing both regions to supersede the advisory executive council.

The pro-Egyptian NUP boycotted the 1948 Legislative Assembly elections. As a result, pro-independence groups dominated the Legislative Assembly. In 1952 leaders of the Umma-dominated legislature negotiated the Self-Determination Agreement with Britain. The legislators then enacted a constitution that provided for a prime minister and council of ministers responsible to a bicameral parliament. The new Sudanese government would have responsibility in all areas except military and foreign affairs, which remained in the British governor general's hands. Cairo, which demanded recognition of Egyptian sovereignty over Sudan, repudiated the condominium agreement in protest and declared its reigning monarch, Faruk, king of Sudan.

After seizing power in Egypt and overthrowing the Faruk monarchy in late 1952, Colonel Muhammad Naguib broke the deadlock on the problem of Egyptian sovereignty over Sudan. Cairo previously had linked discussions on Sudan's status to an agreement on the evacuation of British troops from the Suez Canal. Naguib separated the two issues and accepted the right of Sudanese self-determination. In February 1953, London and Cairo signed an Anglo-Egyptian accord, which allowed for a three-year transition period from condominium rule to self-government. During the transition phase, British and Egyptian troops would withdraw from Sudan. At the end of this period, the Sudanese would decide their future status in a plebiscite conducted under international supervision. Naguib's concession21b on seemed justified when parliamentary elections held at the end of 1952 gave a majority to the pro-Egyptian NUP, which had called for an eventual union with Egypt. In January 1954, a new government emerged under NUP leader Ismail al Azhari.

Data as of June 1991