Chávez called a public referendum, which he hoped would support his plans to form a constituent assembly of representatives from across Venezuela and from indigenous tribal groups to rewrite the Venezuelan constitution. Chávez said he had to run again; "Venezuela's socialist revolution was like an unfinished painting and he was the artist", he said, while someone else "could have another vision, start to alter the contours of the painting". The momentum of the support he received in previous elections, made the referendum on 25 April 1999 a success for Chávez; 88% of the voters supported his proposal.
On 12 August 1999, the new constituent assembly voted to give themselves the power to abolish government institutions and to dismiss officials who were perceived as corrupt or as operating only in their own interests. Opponents of the Chávez regime argued that it was therefore dictatorial. Most jurists believed that the new constituent assembly had become the country's "supreme authority" and that all other institutions were subordinate to it. The assembly also declared a "judicial emergency" and granted itself the power to overhaul the judicial system. The Supreme Court ruled that the assembly did indeed have this authority, and was replaced in the 1999 Constitution with the Supreme Tribunal of Justice.
The Chávez supporting constituent assembly then put together a new constitution. The referendum in December 1999 on whether to adopt it saw a low turnout with an abstention vote of over 50%. However 72% of those who did vote approved the new constitution's adoption. The constitution included progressive language on environmental and indigenous protections, socioeconomic guarantees and state benefits, but also gave greater powers to Chávez. Notably, the presidential term was expanded to six years, and he was allowed to run for two consecutive terms. Previously, a sitting president could not run for reelection for 10 years after leaving office. It also replaced the bicameral Congress with a unicameral Legislative Assembly, and granted Chávez the power to legislate on citizen rights, to promote military officers and to oversee economic and financial matters. The assembly also gave the military a mandated role in the government by empowering it to ensure public order and aid national development, which the previous constitution had expressly forbidden.
The 1999 Venezuelan constitution eliminated much of Venezuela's checks and balances, Chávez's government controlled every branch of the Venezuelan government for over 15 years after it passed until the Venezuelan parliamentary election in 2015.
The 1999 constitution had introduced the concept of a recall referendum into Venezuelan politics, so the opposition called for such a referendum to take place. A 2004 referendum to recall Chávez was defeated. 70% of the eligible Venezuelan population turned out to vote, with 59% of voters deciding to keep the president in power. Unlike his original 1998 election victory, this time Chávez's electoral support came almost entirely from the poorer working classes rather than the middle classes, who "had practically abandoned Chávez" after he "had consistently moved towards the left in those five and a half years".
During the 1980s and 1990s there was a steady increase in crime in Latin America. The countries of Colombia, El Salvador, Venezuela, and Brazil all had homicide rates above the regional average. During his terms as president, hundreds of thousands of Venezuelans were murdered due to violent crimes occurring in the country. Gareth A. Jones and Dennis Rodgers stated in their book Youth violence in Latin America: Gangs and Juvenile Justice in Perspective that, "With the change of political regime in 1999 and the initiation of the Bolivarian Revolution, a period of transformation and political conflict began, marked by a further increase in the number and rate of violent deaths" showing that in four years, the murder rate had increased to 44 per 100,000 people. Kidnappings also rose tremendously during Chavez's tenure, with the number of kidnappings over 20 times higher in 2011 than when Chavez was elected. Documentary filmmaker James Brabazon, stated "kidnapping crimes had skyrocketed ... after late Venezuelan President Hugo Chavez freed thousands of violent prisoners as part of controversial criminal justice system reforms" while kidnappings and murders also increased due to Colombian organized crime activity as well. He further explained that common criminals felt that the Venezuelan government did not care for the problems of the higher and middle classes, which in turn gave them a sense of impunity that created a large business of kidnapping-for-ransom.
Under Chávez's administration, crimes were so prevalent that by 2007 the government no longer produced crime data. Homicide rates in Venezuela more than tripled, with one NGO finding the rate to have nearly quadrupled. The majority of the deaths occur in crowded slums in Caracas. The NGO found that the number of homicides in the country increased from 6,000 in 1999 to 24,763 in 2013. In 2010 Caracas had the highest murder rate in the world. According to the United Nations Office on Drugs and Crime, in 2012 there were 13,080 murders in Venezuela.
In the 1999 Venezuelan constitution, 116 of the 350 articles were concerned with human rights; these included increased protections for indigenous peoples and women, and established the rights of the public to education, housing, healthcare, and food. It called for dramatic democratic reforms such as ability to recall politicians from office by popular referendum, increased requirements for government transparency, and numerous other requirements to increase localized, participatory democracy, in favor of centralized administration. It gave citizens the right to timely and impartial information, community access to media, and a right to participate in acts of civil disobedience.