This article deals with the interrelationship of ethnic and national processes in a rural district in Wollega at the time of the Ethiopian revolution of 1974. It describes how the state policy of ‘official nationalism’ and Amharisation on the one hand, and the policy of land confiscation and land grants on the other, affected two different categories of Oromo: the small, educated elite, and the peasants. The government promoted Amharic as the language of state, whilst the Oromo language was banned from public contexts and not allowed in print. The government feared popular involvement in politics, and all political parties and organisations were banned. University students voiced demands for modernisation and land reform whilst the war in Eritrea raised the ‘question of nationalities’, but there was not yet any Oromo nationalist claim for statehood. Among the farmers, opposition to the state centred on land tenure and taxes and on the abuse of authority by the government. Most Oromo-speaking regions had been conquered and incorporated into the empire in the last decades of the nineteenth century. Land was confiscated and granted to warlords, or to local leaders who collaborated with the emperor. The original inhabitants became tribute-paying tenants under the new lords. As most landlords were immigrants to the area, ethnicity was an obvious aspect of property relations. In Wollega, however, local Oromo who had collaborated with the emperor were in control of much of the land and both landlords and share-croppers were Macha Oromo. They shared basic value-orientations by which performance is judged. Memories of the moral economy of an earlier time provided an alternative to the existing situation. Reference to history implied an active selection of elements in the formulation of a critical discourse on power and property that addressed the basic opposition between society and state. The last part of the article describes how educated and farmers met in a political meeting that was organised by the local authorities in 1976 to celebrate the revolution and its land reform. The occasion turned into an intense celebration of local values and, at least to some of the participants, this was a moment of new ethnic awareness and a call to revive gada, the Oromo ritual system. Threatened by ethnic identification, the state responded with brutal repression, and several people were murdered. Shortly after, some activists joined the Oromo Liberation Front to wage guerrilla war against the state.