Villalobos was one of the main leaders of the People's Revolutionary Army, or "Ejército Revolucionario del Pueblo", a group that emerged in El Salvador in the early 1970s as a loose federation of cells with roots in various Marxist and left-wing Catholic groups. The ERP was one of the five organizations that joined together in 1980 to form the Farabundo Martí National Liberation Front during the Salvadoran Civil War, in which left-wing guerrillas fought El Salvador’s military-dominated and US-backed right-wing government. An economics student and left-wing activist, Villalobos joined the ERP in 1971, at the age of 19. He has since been accused of involvement in the killing in 1975 of Roque Dalton, the revolutionary poet and fellow ERP leader who was shot by his comrades after a power struggle in the group led to accusations that he was a CIA spy. At the time, the killing led to splits and recriminations within the ERP and criticism from other leftists, but after 1980 Villalobos rose to become one of the FMLN’s main military strategists. The ERP under his leadership has been described as “the most efficient military organisation on the Salvadoran left” during the civil war, with Villalobos developing a “reputation for brash strategic brilliance”. The Financial Times described Villalobos as "The true master of 20th-century Latin American guerrilla warfare", above Che Guevara.