The outbreak of the Spanish Civil War surprised Prieto in Bilbao, where he represented the CNT in the "Basque Defence Council" until he moved to Barcelona. Due to his proposal to involve the CNT in the governments of Azaña and Largo Caballero, he was accused of being a traitor and a liquidationist, which led him to resign from his post in November 1936, although he continued representing the Northern Region in the CNT's National Committee and as a member of the Political Advisory Commission (CAP), from where he defended the participation of the CNT in the government of the Second Spanish Republic. Affiliated with the FAI, he was general director of commerce under the ministry of Juan López Sánchez (November 1936 – May 1937) and Undersecretary of Health under Segundo Blanco (April 1938 – February 1939). From the magazine " Timón ", directed by Diego Abad de Santillán, he defended his view that the FAI be transformed into a political party. At the same time he was part of an alliance committee with the UGT and called for the opening of negotiations with the Nationalist faction.