Colonial elections were held in South Australia from 8 April to 27 April 1881. All 46 seats in the South Australian House of Assembly were up for election.
Since the inaugural 1857 election, no parties or solid groupings had been formed, which resulted in frequent changes of the Premier. If for any reason the incumbent Premier of South Australia lost sufficient support through a successful motion of no confidence at any time on the floor of the house, he would tender his resignation to the Governor of South Australia, which would result in interested members declaring their intent to run for the vacant position. A parliamentary ballot would then take place, resulting in the member with the most votes being sworn in by the Governor as the next Premier.
Informal groupings began and increased government stability occurred from the 1887 election. The United Labor Party would be formed in 1891, while the National Defence League would be formed later in the same year.