In 1922, the Jewish population reached 5,500, but most of these Jews were refugees. They received aid from the Committee for Helping Latvian Jewish Refugees, which worked together with the Joint. The latter sent a special committee to organize the situation. The Temporary Committee for Helping Local Jews also received help from the Joint. In 1922, a committee to help orphans was founded with money received from the “Joint”. About a year after the First World War the Jewish population of the city was 4,148, for the city became the center for Jews migrating back from Russia .
Quite a few of the Jews who returned to Rezekne, after the war decided not to stay there, and immigrated to other countries where they had relatives. Because of this, the Jews became, for the first time since they settled in the city, the minority of the total population. A feeling of pessimism enveloped in the community. However there were also some positive developments: the “Joint” gave financial aid to the community, and to needy families; and American landsmen sent one thousand dollars to help reorganize the community. The credit plan, which was funded by the “Joint”, began operating in 1923; by then the community was capable of also being able to give credit. A few years later the Bank of Latvia also gave loans to this credit plan. Its' official name became “The First Jewish Credit and Savings Fund” .
During the period of Latvia's democratic regime (1918-34) the communal life in the city once again began to flourish. Then there was Jewish cultural autonomy . This centered around religious activities, and social aid institutions, such as charity for the needy, help for the sick, and help an old-age home. Real-estate properties that belonged to the community since the nineteen hundreds' were listed as property of the community charity. The head of this charity organization was Dr. Pollak, the son of the rabbi, and he was helped by Azriel Jephet, a descendent of Rabbi Jephet. The organization helped merchants and artisans, gave scholarships to students, and gave to needy families (secretly). In the elections for the city-council, in 1922, there were thirteen Jews, from the various Jewish lists, out of the thirty members. This number went down to nine, in 1926, for soldiers in the army base located in the city received permission to vote. The reason behind this was to increase the number of Latvians, serving on the council, that were then the minority in the city. Up to the beginning of the 1930's, the job of vice-mayor was held by Jews (Isaac Kelmonowich or his rival- Kolman) .
Only once were there elections for the Jewish Community Council, and this was in November 1920. More than seventy percent of those who were able to vote, did so. There were twenty-five council members, and the distribution was as follows: “Bund” and Independent Socialists- six members,”Folks Party  - five members, “Young Zionists'-three members, and the remainder was distributed between members that were not affiliated with parties such as the wealthy and synagogue representatives.
In the 1920's a group organized, known as “Independent Socialists”, which also had Jews among their members. Some of the Jewish youth belonged to the “Bund” and some to the “ Communist Youth Organization”. In 1922, thirteen of the thirty members of the “city-council” were Jews. Afterwards the number went down.
The Jewish population was 3,342 in 1935. This was 25.4% of the total population . The percentage of the Jewish population went down from more than 40% in the end of the 1920's, to 25% in 1935. This was due to Aliyah to the land of Israel, immigrating to America, or young people moving to the capitol city, usually to find jobs. The government influenced Latvians to settle in the city, and a new neighborhood was built for them on the north side of the city. Jews were not allowed to have government jobs .
After the First World War the government in this area changed hands quite often from the Russians to the Germans, and once again the Soviets. Rezekne was the capitol of “Red Latvia” from May 22, 1919, to January 21,1920. The city was part of (free) Latvia from 1920 to 1940, and from then was called “Rezekne”.
The Latvian Dictatorate stopped the opportunity of Jews working as municipal clerks, in 1934. Latvian merchants were favored, upon Jewish ones. In the year 1935 most of the shops (75%), in the center of the city were owned and run by Jews (see Chart 1). The number of Jewish workshops diminished. Jews owned only fourteen of the thirty-six workshops. Even so, the majority of the Jews continued to work in trade or as artisans. There had been a joint aid fund for artisans, but the Jews began to get aid only from their own aid fund. Six of the eighteen doctors, and two of the ten lawyers were Jews..Quite a few of the Jews were able to support themselves nicely .
After the National revolution of Olmanius, in 1934, all the social aid in the community, for helping the needy, was handled by the municipally run government institution known as “The Society for Jewish Aid in Rezekne”. Its' first head was Michael Bobrov, and after him came Michael Metapl. The community rabbis succeeded in getting financial aid for this institution from the well-to-do members of the community. Every Jewish community member was listed as a potential “giver”. Therefore there was much cooperation between the government run organization and the community aid. Kosher meals were given out to the needy and to the children of the unemployed, this formed the Jewish section of the public kitchen which was once again known as “the Jewish uncle”. Because of the bad financial situation which developed in the community in the years of 1938-9, the help was extended to the distribution of clothing, shoes, and wood for heating; and a “childrens' kitchen' run by a women's committee (which gave out 14,770 meals). The community charity organization found new sources for financial aid. A new building for the old-age home was dedicated in 1938, and dedicated to Chaim Ribash. The local branch of the AZA Jewish Health Organisation, that was founded in 1927, now did good work. From the beginning of the 1920's the baby care unit gave care and medicines for free. Now, there was dental care and a day-camp (run with the help of the women's committee).
The community marked the twenty-five years of devoted rabbinical service of Rabbi Lubocki, in 1938 .