Civil and ethnic conflicts in African nations have generated millions of refugees across the globe with unbelievable pictures of suffering and unnecessary death. The instability caused by the magnitude and nature of refugees in Africa is immeasurable. It has given rise to insecurity among nations and within nations. Resources meant for development are subsequently channeled towards quelling such conflicts or attending to refugees. Thus, this study was undertaken to look at the Refugees Crisis in Darfur and the role of the African Union from 2003 to 2006. The factors that could lead to break down of peace in the nation were critically analysed. Such factors as found in this work, includes political and economic marginalization of Darfur people. Some of the factors had its echo informer times. The use of ethnicity to deepen the crisis was also looked into. The role of Government of Sudan in the ongoing crisis was also ascertained. An attempt was made to discover, whether the government of Sudan played a key role in sustaining the crisis. Finally, African Union, which replaced the Organisation of African Unity (O.A.U), was brought into the picture in their first attempt at peace keeping in Africa. Their performance as regards the Act guiding them was also analysed.