Nagy reentered parliament in 1945, becoming minister of reconstruction in 1945 and chairman of the National Assembly (November 1945–February 1946). On 4 February 1946 he was appointed prime minister. During his short tenure in office, he faced three sizable challenges: inflation, nationalization, and growing pressure from the Communist Party. Inflation subsided when new currency was introduced, but the other two problems remained unresolved. Nagy had falsely expected that Soviet troops would depart Hungary after the signing of a peace treaty. Moscow had already decided on the Communist Party takeover of government, however, and the Smallholders Party was gradually eliminated from the political scene. Nagy resigned on 1 June 1947 while on holiday in Switzerland. Soon thereafter he was expelled from the Smallholders Party and deprived of his citizenship.
Nagy moved to the United States and settled in Virginia, where he ran a dairy farm. In 1947 he participated in the foundation of the International Peasant Union, and he became its deputy chairman and then chairman during 1964–1970. During 1963–1970 he also gave speeches and conducted seminars at American universities. After 1970 he withdrew from politics altogether. Nagy died in Fairfax, Virginia, on 12 June 1979.
Csicsery-Rónay, István, ed. Nagy Ferenc miniszterelnök [Nagy Ferenc the Prime Minister]. Budapest: Ezekilencszáznegyvenöt Alapítvány, 1995.; Nagy, Ferenc. The Struggle behind the Iron Curtain. New York: Macmillan, 1948.