Ethiopia, Eritrea Face Off. Again.

If there were an award for the most pointless war of the last 25 years, Ethiopia and Eritrea's 1998-2000 border battle might well take the prize. An estimated 70,000 people were killed, another 750,000 displaced, and by the time of the ceasefire two of the poorest countries on earth had each spent over a half billion dollars fighting over a few dusty miles of parched scrubland. As if that weren't bad enough, the two dictators who oversaw that disaster are now leading their countries dangerously close to a rematch.

On Friday, the independent boundary commission established after the last war is slated to dissolve itself after seven thankless years—without the governments of Ethiopian Prime Minister Meles Zenawi and Eritrean President Isaias Afewerki having reached an agreement on precisely where their border lies. What happens next is anyone's guess. Both governments proclaim their desire for peace while accusing its rival of preparing to launch an attack.

Ethiopia has massed at least 100,000 troops along the frontier, facing off against an estimated 125,000 Eritreans--including 4,000 Eritrean soldiers in what is supposed to be a demilitarized U.N.-patrolled buffer zone between the two armies. A report from the U.N. secretary-general's office this year called the border "tense and potentially unstable." Earlier this fall, Ethiopia's foreign minister said the armies are separated by as little as "70 to 80 meters" in some places.

That means the slightest provocation could trigger a war. But why exactly are two countries with such enormous problems--and so many similarities--at each other's throats yet again? Eritrea, once a part of Ethiopia, is as close culturally to northern Ethiopia as Canada is to the United States. Many people in both countries speak a common language, practice the same ancient branch of Orthodox Christianity, listen to the same Amharic-language pop singers on the radio and share a staple diet of a fermented bread made from teff--a grain commercially grown only in Ethiopia and Eritrea.

Their respective leaders have a lot in common, as well. Zenawi and Afwerki were both born to ethnic Tigray families less than 90 miles apart under Ethiopia's postwar imperial regime. Both studied at Addis Ababa University. Both rose to prominence in the 1980s at the head of secular Marxist-leaning guerrilla groups opposed to Ethiopia's disastrous Derg government, which ruled during the country's great famine in the 1980s. Both preside, too, over countries that share common miseries. Per capita income hovers around $200 a year, about a third of the average for sub-Saharan Africa. More than 40 percent of Eritreans are illiterate, and one in seven Ethiopian children die before age 5. Neither country has any industry to speak of, and most of the population of both Eritrea and Ethiopia are subsistence farmers dependent on good rains to eke out a living. Zenawi himself has called the flashpoint town at the heart of the border dispute no more than "a godforsaken village."

Zenawi and Afwerki share a complex history on their journey from alliance to enmity. Afwerki's more established guerrilla group, the Eritrean People's Liberation Front (EPLF), helped nurture Zenawi's, which was based in the neighboring province of Tigray and was known as the Tigray People's Liberation Front (TPLF). As allies, the two groups swept aside the Derg army and captured Addis Ababa in 1991. Zenawi's TPLF took control of Ethiopia's central government, and Afwerki became governor of Eritrea and later president, when Eritrea, backed by Ethiopia, peacefully seceded in 1993.

But relations soon soured. Afwerki, who viewed himself as something of a mentor to Zenawi, found himself in charge of a country with 7 percent the population of his former acolyte. Tension was inevitable. "There was conflict over who was more important," says one Ethiopian official, who spoke anonymously due to the issue's sensitivity. "And Meles obviously became more important when he took over the bigger country."

By 1998, a series of economic and political disputes led to a rapid deterioration in relations, and Eritrea launched a surprise attack near the disputed town of Badme. Two years of World War I-style trench warfare followed. By the time a U.S.-backed peace agreement was reached in Algiers in 2000, Ethiopian troops had retaken Badme and pushed into Eritrean territory.

As part of the peace deal, the two sides agreed to set up the boundary commission that would demarcate their border based on three pre-World War I treaties between Italy (Eritrea's one-time colonial master) and Ethiopia. Both sides lawyered up, hiring high-powered American attorneys to argue a border dispute that would turn on maps drawn by hand a century ago.

The commission dealt Ethiopia a nasty surprise in 2002, when it awarded Badme to Eritrea. The ruling was hard for Zenawi to swallow, particularly since Ethiopia ended the war with the upper hand militarily, and the prime minister did not fully accept the ruling until earlier this year. However, Ethiopia has continued to thwart its implementation by blocking the commission from demarcating the border on the ground. Ethiopian troops continue to occupy Badme.

That sort of intransigence would normally trigger heavy criticism from Western powers. But fortunately for Zenawi, Afwerki played a clumsy diplomatic hand. After the September 11 attacks, Zenawi became a key Washington ally, allowing the U.S. to interrogate terror suspects in secret prisons and invading Somalia to oust an Islamist government last year. Ethiopia receives about a half billion dollars in official U.S. assistance annually, and Washington offered only muted criticism when Zenawi's government jailed opposition leaders, silenced journalists and killed 193 demonstrators following disputed elections in 2005. Washington has also given short shrift to numerous reports of atrocities committed by the Ethiopian Army in the country's rebellious Ogaden region and in Somalia.

Meanwhile an increasingly defiant Afwerki was busy alienating potential allies and making his nation—once a favorite of the West—a pariah. Eritrea harassed U.N. peacekeeping teams sent to monitor the border, expelled foreign aid agencies, and arrested those working for foreign embassies in Asmara.

It cracked down on religious minorities and political dissidents and gave succor not only to Ethiopian rebels but those from neighboring Somalia and Sudan, as well. Eritrea's coziness with Somali Islamists linked to Al Qaeda led the U.S. earlier this year to threaten to place the country on the State Department's list of state sponsors of terrorism.

As tensions with its much larger neighbor have heightened, Afwerki has conscripted an ever-larger share of its working age population into the military, triggering economic stagnation and a growing stream of defectors. Though Eritrea may be legally in the right when it comes to Badme, it's having a hard time finding many sympathizers.

Predicting what either of the secretive regimes will do is difficult. Without diplomatic help from the outside world, Eritrea's increasingly desperate regime may look to launch a quick strike and hope that international pressure would lead to a ceasefire before Ethiopia could launch a counterattack. Likewise there has been speculation that Zenawi, sensing Afwerki's isolation and confident about Washington's support for Ethiopia, would launch a coup against his old ally—followed by an Ethiopian invasion. "[If] we go to war, the war will be not only to defend ourselves," Zenawi said in a speech Tuesday. "We will teach Eritrea that there won't be a third time."

With tensions rising, analysts believe that Washington and the United Nations also need to put pressure on both sides. While the U.N. could exert diplomatic pressure, the Bush administration could threaten Zenawi with sanctions and a withdrawal of aid if he attacks Eritrea. Earlier this month, U. N. Secretary-General Ban Ki-moon urged that the boundary commission be allowed to proceed with demarcation, and the U.S. State Department issued a statement urging both sides to exercise "maximum restraint."

That may not be enough. Should the two sides ignore peace overtures, it's ordinary Ethiopians and Eritreans who will suffer most. Tsega Gebreab, 57, fled Eritrea last year after the government confiscated her husband's farm and conscripted her eldest son. Now living in the Ethiopian capital of Addis Ababa, she says she can't sleep at night for fear that her son is at the front and soon to become cannon fodder in a war she can't understand. "I almost went mad when my child was taken," she says, her voice cracking. "We're constantly stressed." In this volatile part of the world, that's unlikely to change any time soon.