The party was founded at the congress in Turku in July 1899. It was originally called the Labor Party of Finland. At the Second Congress in 1903, it was renamed the Social Democratic Party of Finland (SDP). At the same time, a program was adopted demanding universal voting rights, universal compulsory secondary education, the socialization of the production means, an 8-hour working day, improved working conditions, and the separation of church and state. As of 1917, the SDP had the largest faction in the parliament (Fin. “Eduskunta”, Rus. “Seim”) of the Grand Duchy of Finland.

After the February Revolution of 1917, the Provisional Government restored the Constitution of Finland. The multi-party coalition government (Senate) that was formed in March included representatives of the SDP and the bloc of bourgeois parties. The SDP leader and the head of trade unions Oskari Tokoi became Deputy Chairman of the Government (Russian Governor-General Mikhail Stakhovich was the Chairman). The Seim was chaired by a Social Democrat as well – Kullervo Manner.

In 1917, the Finnish Social Democrats advocated the independence of Finland, which resulted in their confrontation with the Provisional Government, which considered itself the legal successor of the supreme power in Finland until the All-Russian Constituent Assembly. On July 5, after receiving false information about the overthrow of the Provisional Government in Petrograd, the Seim approved the draft Law on the supreme power proposed by the Social Democrats, according to which power was transferred to the Finnish parliament. In response, on July 18, the Provisional Government decided to dissolve the Seim. As a sign of protest, the Social Democrats withdrew from the Senate but hesitated between recognizing the illegality of the Seim dissolution and preparing for new elections, and eventually lost a significant part of the electorate. In the autumn parliamentary elections, the national conservative forces won the majority in the Seim.