Jefferson ran for president in 1796 but lost to John Adams. Under the electoral system at the time, he became Vice President. This placed him in a difficult position, as he held fundamentally different political views than the President.

The Federalist-controlled Congress passed the Alien and Sedition Acts, which restricted immigration and limited freedom of speech and the press. Jefferson viewed these acts as unconstitutional and a threat to republican principles. He secretly co-authored the Kentucky and Virginia Resolutions in response.

Jefferson and James Madison anonymously authored the Kentucky and Virginia Resolutions, which argued that the states had the right to nullify federal laws that they deemed unconstitutional. These resolutions articulated a strong defense of states' rights and further fueled the political opposition to the Federalist Party.

During his vice presidency, Jefferson actively worked to undermine the Adams administration and promote the Democratic-Republican agenda. He used his position and influence to rally support for his party and prepare for the 1800 presidential election. His relationship with Adams deteriorated significantly during this period.