He was born in 1945 to a prominent and politically active Shi'a merchant family. His father was a member of the Iraqi parliament. His grandfather helped negotiate Iraq's independence from Britain.
But Allawi's own political start was marked by reversals.
Allawi entered politics by becoming a student organizer for the Ba'ath Party while he attended medical school in Baghdad in the 1960s. The party -- marked by its readiness to take and keep power by force -- took part in overthrowing one Iraqi government in 1963 before being deposed itself. After launching a second coup in 1968, the Baathists stayed in power until the U.S.-led overthrow of Hussein last year.
That early political history worries some Iraqis, who today often distrust anyone once closely tied to the Ba'ath Party.
Dr. Abdul Sahib Hakim is an Iraqi human-rights activist in London who knows Allawi well. He assesses Allawi's early Ba'athist days this way: "This is the weakest point, or the [most] dangerous point of his life. I received a lot of calls from inside Iraq, I have been in Iraq five times since the fall of the dictator Saddam, and they don't like the Ba'ath Party members at all, even the ex-members."
Allawi moved to London in 1971 to continue his studies and become a neurologist. His supporters describe the move as an "exile" from Hussein's Iraq, but some of his former associates say he continued to work for the Ba'athists in Europe. Then, in 1975, he had an unspecified falling out with the party and -- three years later -- was nearly killed by an assassin presumed to be a Hussein agent
By 1990, Allawi had become the leader of his own exile party, recruiting former and disaffected Ba'athists. His Iraqi National Accord (INA) attempted a CIA-backed coup against Hussein in 1996. But Hussein's agents detected the conspiracy and many of the officers who were supposed to lead their troops against the regime were killed.
Allawi's fortunes -- like those of other Iraqi exile leaders -- finally improved with the U.S.-led invasion of Iraq. Washington and London turned to them, among other prominent Iraqis, to form the Iraqi Governing Council (IGC) to advise the Coalition Provisional Authority. In the IGC, Allawi took responsibility for security matters.
Mahmoud Othman is an independent Kurdish politician who was a member of the IGC. He says that when the U.S. handed over political power to Iraq's first post-Hussein sovereign government in June, Allawi received the post of prime minister because of his security experience.
"When the Americans proposed Allawi through the Governing Council, we had a majority for Allawi and we supported him," he said. "We preferred him over the other candidates because of one main reason. He was responsible for security in the Governing Council and he was the head of the joint security committee between us and the Americans at the time. So, because the main problem we had was security, we thought he may be the best of these people to deal with these issues."
One of Allawi's first moves after becoming interim prime minister was to announce that his arch foe Saddam Hussein would be tried in Iraq.
He said Hussein would receive a fair trial and that the proceedings would mark a firm break with the past.
"Well, [the trial] will show that justice will prevail, ultimately, regardless of how long it will take to be implemented. We would like to show the world, also, that the new Iraqi government means business and wants to do business and wants to stabilize Iraq and put it on the route and the road to democracy and peace."
But some observers say that if Allawi hopes to fully convince Iraqis that they are in charge of their own destiny, he will have to overcome several major challenges.
Among the biggest of these is winning widespread domestic approval for his un-elected interim government. Many analysts call such approval crucial if the government is to play a larger role in securing the country -- a task now in the hands of the U.S.-led coalition forces.
Former IGC member Othman says that Allawi's government has yet to demonstrate it can reach out to ordinary Iraqis.
"When this government came to power, people were expecting good things from it. But what happened is that the Iraqi administration couldn't get away from the American control. They are all living in one area which is totally protected by the Americans, called the "Green Area." They should have tried to reach the people, to go to the provinces, to see their own people, to talk to them, to see what are the problems, and try to isolate the [hard-core Saddam loyalists and] terrorists from the other type of people who are not satisfied, who are against occupation, who are [reacting to the daily activities of the Americans.] Instead of that...[they] were touring countries outside."
Allawi's government is charged with taking the country to a first round of elections in January to select a transitional National Assembly. The National Assembly is to choose a transitional government to lead the country to direct election of a representative government by the end of next year.
Allawi said yesterday that elections will go ahead in January as planned and that most of the country will be able to participate. He said security conditions in three of Iraq's 18 provinces would prevent their taking part if elections were held today.