Influenced by the teachings of black activist leader Malcolm X, Fela began to realize the implications for Africa of white oppression, colonialism, Pan-Africanism—the unity of African nations—and revolution. His new-found political consciousness inspired him to adopt the middle name Anikulapo—"having control over death"—and change his band's name from Koola Lobitos to Afrika 70 (later Egypt 80). The young musician's work would never be the same; as quoted by Jon Pareles in the New York Times, Fela said, "The whole concept of my life changed in a political direction."

Fela returned to Nigeria and began to write politically charged songs that rocked his country. Inspired by Pan-Africanism, he incorporated African instruments into his band, including Konga drums, klips sticks, and the sekere— a percussion instrument. "I'm playing deep African music," he said at the time, as Pareles noted. "The rhythm, the sounds, the tonality, the chord sequences, the individual effect of each instrument and each section of the band—I'm talking about a whole continent in my music." Fela's protest music became very popular among the ranks of Nigeria's unemployed, oppressed, and politically dissident. These groups remain a large part of his audience.

Fela's music and politics made him a cult figure in Nigeria; he ran for the presidency twice. His openly confrontational messages, however, repeatedly irked government authorities who found reason to jail Fela for a variety of offenses throughout his career. In 1977 official rancor turned violent when the Nigerian military—some say in response to Fela's album Zombie —leveled his imposing Lagos residence after Fela had declared it an independent republic. Before burning down the house—including Fela's recording equipment and master tapes—soldiers went on a rampage in which Fela's 82-year-old mother, a prominent women's rights activist, was hurled from a second-story window. She later died from her injuries. In protest, her son dumped her coffin at the house of then-president General Olusegun Obasanjo.

Although such incidents rallied support for Fela, he was notorious for a lifestyle that alienated many Nigerians; he unabashedly preached the virtues of sex, polygamy, and drugs—in particular the use of marijuana as a creative stimulant. In 1978 Fela shocked his countrymen when he married his harem of 27 women (whom he later divorced), in protest against the Westernization of African culture. His commune, the Kalakuta Republic—established to protest the military rule of Nigeria—was reportedly itself run like a dictatorship. According to the Times's Darnton: "[Fela] ruled over the Kalakuta Republic with an iron hand, settling disputes by holding court and meting out sentences—cane lashings for men and a tin shed 'jail' for women in the backyard. To some degree, these trappings of power account for his popularity among authority-conscious Nigerians." Spin's Larry Birnbaum elaborated on Fela's excesses, reporting, "Stories abound of his setting fire to hotel rooms, firing penniless band members on overseas gigs, making interviewers cool their heels for days and then receiving them in his underwear."

While Fela's politics and lifestyle were controversial, few quibble over the power of his music. In 1986, the human rights organization Amnesty International helped free him from prison, where he had languished due to questionable currency-smuggling charges. Fela and Egypt 80 then made their first tour of the United States, where their audience was limited but growing. He has influenced the work of reggae singer Jimmy Cliff and the Talking Heads' David Byrne. In 1991 he performed an epic gig at New York City's Apollo theater accompanied by 30 support players.

As Fela became better known outside Nigeria he felt that his music increasingly held an international message. He told People's Cathy Nolan: "America needs to hear some good sounds from Africa, man. The sanity of the world is going to be generated from Africa through art. Art itself is knowledge of the spiritual world. Art is information from higher forces, by those who are talented. I'm not jiving. I've been living with my art for 23 years. My music has never been a failure."

Fela died of an AIDS-related illness at his home in Nigeria on August 2, 1997. He was 58 years old.