Why has the Senkaku/Diaoyu territorial dispute escalated recurrently? This study examines the sources of the 2010 and 2012 escalations in territorial disputes over the Senkaku/Diaoyu Islands. We review existing explanations and their limitations and introduce new hypotheses based on the effect of political leaders' interests in the escalation of territorial disputes. We argue that when competition among leaders intensifies or leaders' political vulnerability increases, it is more likely that leaders who are seeking to retain or take office will behave more assertively in claiming rights over territories; therefore, a territorial dispute is more likely to escalate. We find that when Japanese leaders have needed to strengthen their political position during elections, they have adopted aggressive strategies in the dispute to avoid criticism from both the public and political oppositions about their weak postures against China. In China, the succession process has intensified political struggles and has led leaders to pursue a hardline policy with respect to the Senkaku/Diaoyu Islands dispute. The Chinese government and the media have also fueled anti‐Japanese protests to increase internal cohesion for successful leadership transition. This study not only provides a domestic political explanation for the Senkaku/Diaoyu Islands dispute, but also serves as supporting evidence or process tracing for the theoretical proposition that leadership change is associated with the escalation of territorial disputes.