Peñarol dominated their country's Primera División for much of the 1990s and in 1997 they secured a fifth title win in succession. A team that featured much decorated veterans Pablo Bengoechea and Carlos Aguilera won neither the Apertura or the Clausura championships, but stepped up in the play-offs to overcome firstly bitter rivals Nacional, then Defensor to win the overall title.

The club's Libertadores campaign ended in the Quarter-Finals with a narrow aggregate defeat to Racing Club.