When they first appeared in 2014 to fight covertly in Ukraine, the masked militiamen of Russia’s Wagner group epitomised how Vladimir Putin’s Kremlin had mastered a new, underhand form of warfare.

But after Wagner paramilitaries took control of at least one Russian city on Saturday and began a “march of justice” on Moscow, the blowback from nine years of war in Ukraine threatened the very foundations of Putin’s state — with a problem of his own making.

After months of lurid public infighting, the conflict between Yevgeny Prigozhin’s paramilitaries and the Russian defence ministry has boiled over into the first coup attempt in Russia in three decades.

Although Putin appeared shocked by his former caterer Prigozhin’s “treason” during a stern five-minute address to the nation, the chaos indicated how years of covert warfare, poor governance and corruption had created the greatest threat to his rule in 24 years.

“They never should have fought with a [private militia] during a war. It was a mistake to use anything except the army,” a former senior Kremlin official said. “It’s nice to have during peacetime, but now you just can’t do it. That’s what led to this story with Prigozhin — [Putin] brought it upon himself.”

The roots of Prigozhin’s revolt date back to 2014 when Prigozhin set up Wagner as a way for Russia to disguise its involvement in a slow-burning war in Ukraine’s eastern Donbas region. The group helped keep eastern Ukraine under Russian proxy control and, as its mission expanded, gave Russia plausible deniability for sorties as far away as Syria and Mozambique.

But for all its ostensible independence — the Kremlin claimed to know nothing about it, while Prigozhin denied for years that the group even existed — Wagner was a big part of Russia’s official war machine.

Initially run by GRU, Russian military intelligence, Wagner was lavishly funded from the national defence budget and often competed with the armed forces for lucrative contracts, according to people close to the Kremlin and security sources in the west.

That nourished a rivalry that began years before Putin’s full-scale invasion of Ukraine, heated up during the bloody siege of the town of Bakhmut this winter and spilled out of control this week, the people said.

“The main reason Prigozhin happened at all is because Russia . . . couldn’t create an effective army. They had to create an ersatz army instead, and it was obvious from the start that creating a parallel army has huge risks,” said Ruslan Pukhov, director of the Center for Analysis of Strategies and Technologies, a Moscow-based defence think-tank.

As it took an increasingly prominent role on the front lines and its feud with the army deepened, Wagner became a kind of Frankenstein’s monster that eventually turned on its creator, according to analysts and people close to the Kremlin.

Prigozhin, who has known Putin since the future president visited his restaurant in St Petersburg in the 1990s, criticised the army in blistering terms, which led many in Moscow to suspect he had Putin’s approval.

Wagner’s forces were largely drawn from convicts after Putin personally signed tens of thousands of pardons.

Moreover, as one of the few members of Russia’s elite not privately appalled by the war, Prigozhin’s belligerence helped him emerge as a hardline political figure.

He urged Putin to adopt a state of “total war” modelled on North Korea, revelled in a murder Wagner militiamen appeared to commit with a sledgehammer and sent a replica of the weapon to a senior lawmaker so he could pose with it.

His rise horrified many of Moscow’s elites, who feared he would be used to beat them into backing the war effort or simply seize their assets with Putin’s support.

That dependence appears to have lulled Putin into a false sense of security. It convinced him that he could allow Wagner to undermine the defence ministry while keeping it under control, according to Tatiana Stanovaya, a senior fellow at the Carnegie Russia Eurasia Center.

“He thought Prigozhin was isolated. He doesn’t have a party, he doesn’t hold rallies, so he doesn’t exist. Putin doesn’t understand what the internet is, so he didn’t know that Prigozhin was more dominant online than him or the war or anything else,” Stanovaya said.

“He thought Prigozhin was totally dependent and [ . . .] could be routed in one second if needed.”

The exact circumstances leading to the uprising remain unclear. One person close to the FSB said Russia’s security forces had spent the past several days preparing for some kind of assault, suggesting Prigozhin had learnt of the plan and had decided to go out all guns blazing. “This isn’t out of nowhere and it didn’t come as a surprise,” the person said.

Another former senior Kremlin official said the conflict with the army had driven Prigozhin — a former criminal who is said to revel in publicly executing deserters — to even further extremes.

“He went nuts, flew into a rage and went too far. He added too much salt and pepper,” the former official said. “What else do you expect from a chef?”

An important trigger for Prigozhin’s uprising appears to have been Putin’s decision to back the defence ministry’s attempts to bring Wagner to heel.

After Russia captured Bakhmut last month, Wagner’s forces left the front lines, prompting Prigozhin to muse about whether they would return at all. Then, Putin supported defence minister Sergei Shoigu’s attempt to bring the jumble of militias fighting in Ukraine under the army’s control.

“He was pushed to this when he realised he was being driven into a corner, losing power and control over Wagner,” Pukhov said. “He didn’t just want to sink into obscurity.”

Prigozhin’s meteoric rise as a public figure appeared to have fostered a deep resentment at being told to take orders, as well as personal grievances against Shoigu and Valery Gerasimov, commander of Russia’s invasion force.

Stanovaya said the war had brutalised Prigozhin, who had recorded several tirades where he posed in front of battlefield corpses and blamed Shoigu for their deaths, to the point where he lost sight of his place in Russia’s hierarchy.

“This is a man who spent several months looking at torn-off arms and legs and severed heads while at war. He doesn’t think about red lines, how the [Kremlin] thinks of him and so on,” she said. “He thinks he deserves privileges and that even Putin can’t do anything about it.”

In his speech on Saturday, Putin appeared to have belatedly realised the threat Wagner posed to the state. He likened it to the collapse of the Russian empire in the 1917 revolution, which he said ended in “an enormous collapse, the destruction of the army and the fall of the state, the loss of huge territories, and in the end, the tragedy of civil war”.

As Wagner’s forces advanced northwards towards Moscow, Russia’s belief that it could outlast Ukraine and the west in a long war has proved a “dangerous illusion,” Pukhov said.

“Dragging the war out has huge domestic risks for Russia. The first destabilising blow came even earlier than they thought. Now the risks are only going to grow.”