At the end of 2020, a major split in the Nepal Communist Party (NCP) revived the Communist Party of Nepal (Unified Marxist–Leninist) (CPN (UML)) and the Communist Party of Nepal (Maoist Centre) (CPN (MC)).

A further split occurred within the CPN (Maoist Centre) when a group led by Ram Bahadur Thapa (Badal) joined CPN (UML). Similarly, a group led by former prime minister Madhav Kumar Nepal and Jhala Nath Khanal split from CPN (UML) to form CPN (Unified Socialist).

In December 2021, a small group led by Hridayesh Tripathi left CPN (UML) to form the People's Progressive Party. Another group led by Senior Vice-president Bam Dev Gautam left CPN (UML) in September 2021 and was preparing to form a new party as of February 2022.^{[needs update]}

During a party secretariat meeting on 21 August 2019, senior leader Madhav Kumar Nepal issued a note of dissent regarding the divided party and criticized the two co-chairmen: KP Sharma Oli, the then prime minister, and Pushpa Kamal Dahal. Nepal's grievances with the party leadership included their inability to expediently complete the merger between the former CPN (UML) and CPN (Maoist Centre), the two parties that had combined to form the NCP. He also criticized Oli for not following the "One Leader, One Position" policy that the party had campaigned on and called for Oli to either resign as party leader or as prime minister. Another meeting took place on 21 November 2019, when the party decided on moving forward with two party leaders, with Dahal holding the position of executive head of the party. The meeting also resulted in an agreement to allow Oli to complete his full term as prime minister.

Another disagreement arose when factions in the party did not favor a grant that the government had previously negotiated with the United States under the Millennium Challenge Corporation. The issue was resolved after a task force formed by the party decided to not endorse the proposed agreement as is.

Criticism by party members led Prime Minister Oli to reshuffle his cabinet in November 2019.

In February 2020, Bam Dev Gautam was appointed as the party's vice-chairman after the party's central committee amended the party statute. Party co-chairman Pushpa Kamal Dahal and Madhav Kumar Nepal criticized the Oli government's handling of the COVID-19 pandemic, and leaders within the party urged senior leadership to call a meeting of the secretariat to discuss the government's work. At the meeting of the secretariat, some leaders called on Oli's resignation, but a later meeting decided to allow Oli to stay on after he agreed to work under the party's instructions and let Dahal perform his duties as the party's executive leader.

In August 2020, a panel tasked to resolve the party's internal dispute proposed that a national convention be held in April 2021 regarding party unity, a recommendation which was endorsed by the party's standing committee.