The first harsh repression of opposition came in 1929. Under the direction of Choybalsan, more than 600 feudal estates (herds and fixed property) were confiscated and were given to members of the laity and to monks who left their monasteries. In 1931 and 1932, the property of more than 800 religious and secular leaders was seized, and more than 700 heads of households were killed or imprisoned. The antireligious campaign was three-pronged: ordinary monks were forced to leave the monasteries and enter the army or the economy; monks of middle status were put in prison camps; and those of highest rank were killed. Collectivization followed expropriation, and by 1931 more than one-third of the stock-raising households had been forcibly communized.

The brutal collectivization of herdsmen was rapid, and it caused bloody uprisings. Although the Eighth Party Congress from February to April 1930 had recognized that the country was unprepared for total socialization, the party reaction to opposition was to reenforce its measures nevertheless. The massive shift from private property to collectivization and communization was accelerated. The party then attacked the entire monastic class, the nobility, the nomads, and the nationalists, while purging its own ranks. The government imposed high and indiscriminate taxes, confiscated private property, banned private industry, forced craft workers to join mutual aid cooperatives, and nationalized foreign and domestic trade and transportation.

Extremism produced near-disaster. The power of the monks and the feudal nobles finally was broken, Chinese traders and other foreign capitalists were ousted, and still greater dependence on Soviet aid was required. The mechanical imposition of communes on an unprepared nomadic sheep-herding and cattle-herding society, however, resulted in the slaughter of 7 million animals in three years by angry and frightened herders. Mongolia's economy, which rested entirely on animal husbandry, was severely affected. The failure of communes, the hasty destruction of private trade, and inadequate Soviet supplies contributed to spreading famine. By 1931 to 1932, thousands were suffering severe food shortages, which, together with the people's reaction to terror, had brought the nation to the verge of civil war. Finally the government was forced to call in troops and tanks; with Soviet assistance, it suppressed the spreading anticommunist rebellion in western Mongolia.

In May 1932, a month after anticommunist uprisings in western Mongolia, the Comintern and the Communist Party of the Soviet Union directed the Mongolian party to end its extremism. The next month, the party Central Committee rejected its prior policy as "leftist deviation" and expelled several top leaders as "leftwing adventurers." Choybalsan announced that "the overall development of our country has not yet entered the stage of socialism, and also it is wrong to copy Soviet experience in every single thing." The entire socioeconomic pattern was swiftly changed. The collective farm experiment was dropped, worker cooperatives were abandoned, the cattle tax was reduced, and herders and peasants again were allowed to hold private property. Foreign trade, still channeled exclusively to the Soviet Union, continued to be controlled by the state, however. Under continuing Soviet protection and domination, Mongolia now settled down to a period of gradual social change.

An underlying reason for Moscow's reversal of the course of Mongolian socialism had been the growing Japanese threat. The September 18, 1931, Mukden incident had opened the way for Japan to establish Manchukuo (Japanese-controlled Manchuria). Mongolians were not alone in the fear that Japan might try to establish a Japanese-controlled Mongolian monarchy, Mengkukuo...

In the late 1920s and the early 1930s, the army frequently was called on to put down widespread popular revolts led by nobles and monks. The revolts erupted from a basic feeling of nationalism (particularly in western Mongolia), from opposition to the pro- Soviet line, and from the government's extreme measures in forcing collectivization of stock raising and harsh actions against the monks. The revolts culminated in an uprising by 13 detachments of more than 3,000 troops in April 1932; it was put down by the Mongolian army, assisted by a large Soviet Red Army force. By the mid-1930s, the communist government had suppressed the insurgency. It then decided that a more reliable army was necessary, both for internal security and for actions as a forward screen for Soviet troop deployment in the event of a Japanese invasion.

As the army recovered from the revolt, it began rebuilding. The number of young Mongolians on active duty increased annually. During this period, the army acted as an important unifier of the population, in effect supplanting the liquidated monasteries in this role. In striving for national reinvigoration, the army's military role was less important than its social and political roles. A Soviet observer wrote that the army taught the soldier to read and write the national language and converted him into a politically aware soldier-citizen. Soviet arms and military equipment were provided to the expanding army, and Soviet officers acted not only as instructors, but also as unit advisers and commanders.