After 9 September 1944, Zhivkov became head of the Sofia police force, restyled as the Narodna Militsiya (People's Militia). He was elected to the BKP Central Committee as a candidate member in 1945 and a full member in 1948. In the run-up to the 1949 treason trial against Traicho Kostov, Zhivkov criticised the Party and judicial authorities for what he claimed was their leniency with regard to Kostov. This placed him in the Stalinist hardline wing of the Party. In 1950, Zhivkov became a candidate member of the BKP Politburo, then led by Vulko Chervenkov, leading to a full membership in 1951. In the years which followed, he was involved in countering countryside resistance to forced farm collectivisation in north-western Bulgaria.

After Stalin's death, an emphasis on shared leadership emerged. Chervenkov stood down as BKP first secretary in 1954 and Zhivkov took his place, but Chervenkov retained some of his powers as prime minister. Bulgarian opinion at the time interpreted this as a self-preservation move by Chervenkov, since Zhivkov was a less well known figure in the party. After Nikita Khrushchev delivered his famous secret speech against Stalin at the CPSU 20th Congress, a BKP Central Committee plenary meeting was convened in April 1956 to agree to adopt a new Krushchevite line. At that plenum, Zhivkov criticised Chervenkov as a disciple of Stalin's, had him demoted from prime minister to a cabinet post, and promoted former Committee for State Security (DS) head Anton Yugov to the post of prime minister. It was at this point that he became the de facto leader of Bulgaria. Since then, Zhivkov was associated with the "April Line," which had anti-Stalinist credentials. At the BKP 8th Congress in late 1962, Zhivkov accused Yugov of anti-Party activity, expelled him from the BKP and had him placed under house arrest. As prime minister, Zhivkov then held both of Bulgaria's leading political and government posts. Though the post of head of state was traditionally reserved for the leader of the surviving pro-Communist faction of the BZNS Bulgarian Agricultural National Union, the "Zhivkov Constitution" adopted by referendum in July 1971 promoted him to chairman of the new Council of State (president), giving him de jure control of Bulgarian affairs in addition of his already present de facto control.

Though officially a Communist internationalist, Zhivkov displayed a somewhat nationalist agenda, for example attempting to turn Bulgaria into an economic and military factor within the Balkans and South-Eastern Europe. The Zhivkov regime's tendencies were also expressed in various aspects of its cultural policy: both in education and in art, Bulgaria's patriotic view of its national history was dominant, and many films on traditional historical themes were produced by the state during the Zhivkov era: some well-known examples would be The Goat Horn (1972) revolving around Turkish violence against Bulgarians during Ottoman rule; 681: Velichieto na hana (681 AD: The Glory of Khan) (1981) about Asparukh, the founder of the Bulgarian state; Boris I (1985) on the Christianization of Bulgaria in the Middle Ages; and Vreme na nasilie (Time of violence) (1988) about forced conversions of Bulgarians to Islam by Ottoman authorities in the 17th century. Some nationalist policies existed for example assimilation policies towards Pomaks (Bulgarian Muslims) and Turks. These policies culminated in campaigns respectively in 1972 – 1974 and 1984 – 1985. The latter was openly marketed as a "Revival Process" that aimed to restore the "real" national consciousness of these minorities, which had allegedly been Bulgarian before being coercively Islamized or assimilated in Ottoman times.

Formally a Stalinist, by the "April plenum" in 1956 he had switched camps, becoming an ardent anti-Stalinist Khrushchevite. After the Hungarian Revolution that autumn, he allowed Chervenkov to regain lost prominence as "counter-revolutionary elements" were purged and the relationship with China was strengthened. A Chinese-style "Great Leap Forward" was iniated in 1958, before being aborted. At the BKP's 8th Congress in 1962, Zhivkov reiterated his anti-Stalinist credentials by removing former Stalinist secret police chief Yugov from the prime ministership.

After the November 1964 advent to power of Brezhnev, Zhivkov adjusted his rhetoric to suit the new Kremlin line and went on to develop a very close personal relationship with Brezhnev himself. As the Sino-Soviet split became final by 1966, Zhivkov elected to distance himself diplomatically from the Chinese. In his memoirs, he reveals that the decision had not been easy, with Mao's analysis and approach being close to his views. A failed Stalinist plot against him in early 1965 lent Zhivkov some support from more liberal Party circles and sympathy from the Bulgarian public. In 1966, Zhivkov announced an economic reform allowing "full accounting responsibility" to state companies, in effect allowing them to manage themselves within a "Socialist market." This was to be echoed in Gorbachev's "Khozrazchet" policy twenty years later. A quasi-private company, Teksim, even emerged as a flagship of the "Socialist market." However, as the Prague Spring with its market overtones was crushed in August 1968 with symbolic Bulgarian military assistance (inter alia), Zhivkov rapidly reiterated the principles of the planned economy and shelved all traces of market orientation.

The 1970s was a period of closeness between Brezhnev's USSR and Zhivkov's Bulgaria. Zhivkov became Hero of the Soviet Union in 1977. Yet, though Bulgarian émigré dissident Georgi Markov wrote that "[Zhivkov] served the Soviet Union more ardently than the Soviet leaders themselves did," in many ways he can be said to have been exploiting the USSR for political purposes, with Bulgaria serving a buffer between the USSR and NATO. Thus, he claims in his memoirs that the USSR had become "a raw material appendage to Bulgaria," something obliquely confirmed by Gorbachev when he wrote in his memoirs that "Bulgaria was a country which had lived beyond its means for a long time." An example of how the "raw material appendage" was exploited was the trade in Soviet crude oil. This would be shipped to Bulgaria's modern refinery in Burgas at subsidised prices, processed, and resold on world markets at a huge premium.

In 1984, as part of a policy of Bulgarisation, all Bulgarian nationals who were ethnically Turkish were forced to exchange their names for Bulgarian names amid official pressure, some violence and loss of life (Muslim Bulgarians had been forced to change their names in 1972). In early 1989, in some areas with large ethnic Turkish populations there were clashes with twelve fatalities. Shortly after that, the border with Turkey was opened and up to a third of a million people left Bulgaria for Turkey in the late spring and the summer of 1989 (though about a third of those returned by the end of the year). Most people left under tourist visas which caused the event to be dubbed "the Great Excursion".

Zhivkov was mindful of the need to adjust to the new Gorbachev leadership in Moscow. He first advised the BKP to "lie low" until the figurative waves passed overhead. By early 1988, however, as Gorbachev pushed his reforms ever further Zhivkov could no longer stay on the sidelines; he launched a less radical version of Perestroika which he called Preustroystvo (meaning the same as Perestroika). Alongside the political liberalisation of Perestroika, Gorbachev also stood for economic reforms under the Khozrazchet (business accountability) banner. Zhivkov ardently supported Khozrazchet which dovetailed with his own ideas of the mid-1960s. He thus conducted a number of market liberalisation reforms, foremost among them being Ukaz 56 (Decree No 56) which allowed the emergence of small privately-owned businesses. Another reform was the new Bulgarian Labour Code, a legislative act which distributed state owned companies' equity to their workers.

In defence matters, Zhivkov was a steadfast Soviet ally and pillar of the Warsaw Pact mutual defence organisation. Universal male conscription since 1971 made Bulgaria's readily available manpower large in proportion to its population. At times, up to 200,000 men were under arms, backed by the latest in Soviet aircraft and missiles. Segments of Bulgarian motorways still exist with no barriers between opposite traffic lanes; these intervals were intended for use as runways in potential military conflict (presumably with the West). Zhivkov consistently backed Bulgaria's secret police and intelligence organisation, the Darzhavna Sigurnost (State Security), in turn relying on it for information on popular moods as well as those of even his closest associates. The DS amassed a huge apparatus of informers and agents in all walks of Bulgarian life. Acts of the National Assembly passed in 1997 and 2006 have allowed public access to DS records, and it has transpired that very few Bulgarians were unattended by the "organs" of internal security. In 2007, a National Assembly committee reported that 139 (roughly a tenth) of all National Assembly Deputies since 1990 had been DS informers or agents during the Zhivkov years.

Regardless of whether he wore one of his many interchangeable "Stalinist" and "liberal" masks, Todor Zhivkov was never tolerant of dissent. Dissent, however, was never as significant as in other socialist countries and despite incidents such as the infamous September 1978 "umbrella murder" of Georgi Markov in London, he was not a punitive despot in the Stalinist mould. After seizing complete Party and executive power at the 8th Congress in 1962, he closed Bulgaria's infamous "Labour and Reeducation Camps" (major among them the Belene labor camp and the Skravena women's colony). Instead of imprisoning or physically eliminating his enemies, he followed the practice which Georgi Markov describes as "having a door open behind your back as another door closes in your face." In Zhivkov's time, Bulgarians faced great difficulties when asking to travel abroad and secret police informing was popularly perceived as being universal and directed at even the most trivial aspects of daily life.

Zhivkov promoted his children, daughter Lyudmila Zhivkova and son Vladimir Zhivkov, in the BKP hierarchy. Lyudmila became Politburo member and introduced non-orthodox ideas as head of the arts. Son-in-law Ivan Slavkov was made chairman of Bulgaria's state television company and later became president of the Bulgarian Olympic Committee. Apart from promoting his family, Zhivkov instituted a complex system of privileges which extended to former Resistance figures, Party members and prominenti of the sciences, arts and manufacture. In the early 1960s, he was instrumental in constructing a large set of housing, financial, educational, electoral and other benefits to be granted to a large category of people called "Active Fighters against Capitalism and Fascism" who had ostensibly been members of the rather modest Bulgarian Wartime resistance and which was expanded to absurd proportions. Without necessarily receiving great remuneration (pay differentials under Zhivkov were within the 5:1 range, with the overwhelming majority of salaries being within the 3:1 range), Party members and DS informers received very significant perquisites which involved access to accommodation, luxury imported goods, hard currency, the ability to travel abroad, superior medical and dental treatment and unhindered entry to higher education for their children. The scope of these privileges broadened as they rose in the Party hierarchy. Eminent artists, scientists and "Heroes of Socialist Labour" (mostly collective farmers and shop-floor workers) received similar privileges. Established in the early years of Zhivkov's terms in power, Corecom was a retail chain in which foreigners could shop with hard currency, but its main customers were privileged Bulgarians close to the Zhivkov regime.

In Zhivkov's Bulgaria, money had lost many of its traditional properties, being replaced by sets of complex personal and family material and career considerations which have been described as "feudal." This hampered the prosecution in post-Zhivkov fraud and corruption trials, since no venality could be proved against those charged: they had merely received goods in kind and services which moreover had been their "legal due."

Zhivkov reserved a special attention for his birthplace of Pravets. In the 1960s this small village was declared "an Urban Community," becoming a town a decade later. In 1982 Bulgaria's first Apple ][ clone personal computer was named the Pravets. The grateful citizens of Pravets responded by erecting a heroic statue to Zhivkov which he duly had taken down, ostensibly to prevent a personal cult growing around him. It was re-erected after his death.

Throughout his tenure of power, Zhivkov surrounded himself with those who exhibited predanost (loyalty, devotion, the desire to proffer all). In his reminiscences, Vladimir Kostov, a Bulgarian secret agent who defected to France in 1978, recalls how the powerful minister of internal affairs would suffer nervous episodes before meeting Zhivkov lest his predanost should fail to come across sufficiently expressively.

Throughout his term of power, Todor Zhivkov's country accent and poor manners made him the butt of many acerbic jibes and jokes in Bulgaria's urbane circles. While the feared DS secret police was commonly said to persecute those who told political jokes, Zhivkov himself was said to have "collected" them. His popular nickname was "bai Tosho" (approximately "Ol'Uncle Tosho") or occasionally (and later), "Tato" (a dialectal word for "Dad" or "Pop"). Markov tells a story of how Zhivkov reproached a popular newspaper cartoonist for modifying his signature to resemble a pig, yet did not persecute him. While a handful of "licensed" satirist dissidents such as Radoy Ralin did enjoy some popular prominence, many others were convicted of "calumnies" or "hooliganism" for daring to ridicule authority.

Zhivkov survived the Sino-Soviet split, Khrushchev's fall in late 1964, an attempted Stalinist-Maoist coup d’état in 1965, his daughter Lyudmila Zhivkova's death in 1981, Brezhnev's death in 1982, and Mikhail Gorbachev's post-1985 reforms. Having become the longest serving Soviet bloc leader, in 1988 he allowed himself to advise Gorbachev on the course of future reforms. Zhivkov was forced down as Party leader at a BKP plenum on 10 November 1989, just as the Berlin Wall fell. He also gave up his position as head of state a few days later. His rule represented a distinct era.

While he was initially shown reverence in public in removal, by January 1990 he was removed from the BKP and was arrested on a number of fraud and nepotism charges. Two years later, he was convicted of embezzling government funds and sentenced to seven years in prison. Due to old age and frail health, he was allowed to serve his term under house arrest. He was eventually acquitted by the Bulgarian Supreme Court in 1996. Zhivkov retained his lucidity and interest in public affairs until his death (of pneumonia) in August 1998, aged 86. His funeral was widely attended. After his death all charges against Todor Zhivkov were dismissed.

The Porcupine, a fictional account of the trial of Stoyo Petkanov, a barely disguised Zhivkov, was written by Julian Barnes and published in Bulgarian and English in 1992.

While Zhivkov's economic policy was largely successful, its collapse after his fall makes it questionable how the economy was really developed. A most telling verdict on Zhivkov's rule and its aftermath is the "demographic problem". His Turkish/Muslim policy produced an effect diametrically opposed to the one he aimed for.

After Zhivkov fell from the presidency and was expelled from the BKP, the Party gave up its monopoly on power in February 1990 and allowed Bulgaria's first democratic elections for 59 years in June 1990. As the Soviet Bloc in the face of the Council for Mutual Economic Assistance (SEV, Comecon), the Warsaw Pact Organization and the USSR itself collapsed, by 1992 Bulgaria entered a period of transition from socialism to a free market economy and democracy. To this extent, the political ideology and foreign policy orientation of Zhivkov's era were entirely reversed. On the other hand, Bulgaria's post-transition political, business, military, academic and artistic elites, as well as Bulgaria's large and active organised crime underworld, comprised almost entirely the scions of Communist eminenti who rose to prominence during Zhivkov's long rule. In this sense, the personnel element of his rule has endured and looks most likely to endure unchallenged for the foreseeable future.

Zhivkov's onslaught on Bulgaria's Muslims and Turks radicalized and united what had been scattered and quiescent minorities. Since 2001 (and also from 1991 – 1994) the DPS (Movement for Rights and Freedoms) party, composed almost entirely of Bulgarian Turks, has held the balance of power in Bulgarian politics. Thus, a major Zhivkov project produced the very opposite effect from that intended. In the early 2000s, there appears no prospect of an alternative scenario to the prevailing one in which the DPS is a desired partner in any governing coalition.

A most damaging process, which emerged during the early years of Zhivkov's rule, was the "demographic problem" which saw traditionally large Bulgarian village families emigrate to industrial cities where they tended to have one child or none at all. Measures which were undertaken during his regime, consisting mainly of fines for families without children and limiting abortion, were largely ineffective. As a result, at the turn of the 21st century the Bulgarian population was widely expected to decline from a 1990 high of nine million to some five million within a generation.

On the other hand, after very significant reverses and difficulties in the 1940s and '50s, the Bulgarian economy developed apace from the mid-1960s until the late '70s. Most of today's large industrial facilities such as the Kremikovtsi steelworks and the Chervena Mogila engineering works were built under Zhivkov. Bulgaria's nuclear power station, AEC Kozloduy, was built in the 1970s, all six large reactors commissioned in under five years. This, and Bulgaria's many coal-fired and hyrdoelectric power stations, made the country a major electric power exporter. By the 1970s, the focus switched to high technologies such as electronics and even space exploration: on 10 April 1979 Bulgaria launched the first of two kosmonavti (cosmonauts), Georgi Ivanov, aboard Soviet Soyuz spaceships and went on to launch its own space satellites. Having been among the first nations to market electronic calculators (the Elka brand, since 1973) and digital watches (Elektronika, since 1975), in 1982 the country launched its Pravets personal computer (a near-"Apple II clone") for business and domestic use. In the mid-1960s an economic reform package was introduced, which allowed for farmers to freely sell their overplanned production. Shortly after that Bulgaria became the first and only Eastern Bloc country, which locally produced Coca-Cola. Mass tourism developed under Zhivkov's direction from the early 1960s onwards.

However, this Bulgarian economy was exceptionally susceptible to Soviet largesse and Soviet-bloc markets. After the Soviet crude oil price shock of 1979, it entered a very severe recession from which it hardly recovered in the 1980s. After the early-1990s loss of Soviet and Comecon markets, this economy (unused to competing in a free market environment) entered prolonged and significant contraction. Zhivkov-era industrial facilities were largely unattractive to investors, many being left to decay. Great numbers of specialist personnel retired and died without being replaced, or else emigrated or left their state jobs for more lucrative private employment. As agriculture declined, tourism has emerged as almost the sole Zhivkov-era industrial survivor. It is however widely regarded that incompetent administration after 1989 had a much greater effect on the decline of the economy, as even successful industries declined.

Recent publications based on data from the secret state archives from the period of communist government show a completely different image of the Bulgarian economy under communism. Bulgarian economy went twice through bankruptcy - in 1960 and in 1987 and was close to a third one in 1978. Due to insolvency problems towards western creditors and the Soviet union (debts reaching $ 3 billion about 1960), Todor Zhivkov takes personally the decision to sell to the USSR the strategic state gold reserve (more than 20 tons). Between 1960 and 1964 additionally about 32 tones of gold are sold. A few years after the deal the price of gold on the international market rises 10 times, which makes the loss for the Bulgarian economy considerable. After 1989, interrogated by the public prosecutor, Zhivkov initially denies remembering details about the disastrous financial operations. Finally he acknowledges "The state was lacking finances and we stood in front of a total bankruptcy". In 1987 (two years before the official fall of the communist regime), the Bulgarian debt towards international creditors reaches $ 6 billion. The total Bulgarian export cannot cover the annual debt duties. New credits are needed. In two years the debt reaches $ 10.5 billion.

Bulgaria's post-Zhivkov armed forces collapsed from over a quarter of a million men at arms to a 2007 figure of under 50,000 free-serving men and women. Technologically, in 2007 Bulgaria's armed forces were largely equipped with obsolescent Soviet-era arms. Zhivkov's dream of turning Bulgaria into a power-broker within South-Eastern Europe can thus also be said to have come to nothing.

Zhivkov's widely feared, seemingly well-drilled and ultra-loyal security apparatus did nothing to stop his departure from power and did little to halt Bulgaria's decisive drift away from the USSR and towards the West. In this sense, the largesse he lavished on this apparatus can be said to have been entirely misspent.