After negotiations between the Conservatives and Liberals broke down following the February 28th election - Harold Wilson was invited to form a minority government. Labour had 301 seats, but this was 17 short of an overall majority. He called an election on 18th September, to be held on 10th October. He won a majority of seats - just - Labour won 319 seats, a majority of 3!. This would have been difficult enough, but the Labour Party was divided on a number of issues. The Referendum on continued membership of the European Economic Community was meant to resolve the issue once and for all - but a "Yes" campaign which was vastly better resourced than the "No" campaign - and which the solid backing of much of the "establishment" - led many anti-Europeans to continue their active opposition.
A fractious Parliamentary Labour Party meant there were a large number of rebellions. The issues were wide ranging - but centered upon Europe; Terrorism (at this time - it was Irish terrorism - and in the 1970s there were a number of bomb attacks on the mainland); the Economy and Devolution. It was remarkable that the Government survived for so long. Philip Norton (Lord Norton of Louth) published a detailed study of rebellions in this Parliament -
Labour's first by-election loss came in June 1975. In March 1976 Harold Wilson, to everyone's surprise, resigned - and Jim Callaghan was elected by Labour MPs as his successor. By 1977 it was a minority government. A "Lib-Lab pact" with the Liberals gave some support - but the government fell after losing a vote of no-confidence by a single vote on 28th March 1979. Roy Hattersley described the events of that day in a Guardian article.
Other First hand accounts of that Government can be found in the following books