Despite Al-Mansur's inherent fickleness, he was not one to trust anyone or remain steadfast in any decision. He was prone to many suspicions and doubts, quick to anger. This is evidenced by his actions towards Al-Fadl, who had rendered great service to all the Abbasid allies, for without his efforts, the Caliphate would not have reached their hands.

When he was told that Abu Muslim was claiming to be of the Prophet's household, he ordered him to be killed. Due to his intense anxieties, he abandoned the Hashimiya, which was the seat of the Abbasid Caliphate, and began to build a city he called Madinat al-Salam, later known as Baghdad, the capital of the Abbasid Caliphs. He appointed his nephew, Isa ibn Musa, as heir apparent, a position to which Al-Saffah had bequeathed him after his death.

Al-Mahdi ibn Al-Mansur succeeded him, with the understanding that Isa would be the next Caliph. Al-Mansur then moved from Ibn Hubayra's city to Baghdad to complete its construction. He consulted his companions and asked Khalid ibn Barmak about demolishing the palaces of Khosrau and the throne. Khalid replied that it was a symbol of the Persians and that it should be moved to Baghdad. Al-Mansur ordered the demolition of the White Palace, but only a section was demolished. The cost of demolition exceeded the value of the demolished part, so it was abandoned. Khalid then advised him not to abandon it, lest it be said that he was unable to destroy what others had built. Al-Mansur agreed and abandoned the demolition. Al-Mansur then took the gates of Wasit and set them up in Baghdad, making Baghdad circular so that no one would be closer to the Sultan than others. He built his palace in the center and the mosque next to the palace.

In the year 150 AH, Imam Abu Hanifa Al-Nu'man ibn Thabit passed away. Abu Hanifa was a scholar, a man of action, and an ascetic. Abu Ja'far Al-Mansur asked him to take on the position of judge, but he refused. He was known for his eloquence and, according to some, for his long and excellent discourse. Al-Shafi'i asked Malik if he had seen Abu Hanifa, and he replied, "Yes, I saw a man if you entrusted him with turning this pillar into gold, he would present an argument for it." He was born in Kufa in the year 80 AH and died in Baghdad in prison for refusing to be a judge. It is said that he died on the same day Imam Al-Shafi'i was born, in the month of Rajab of this year. His tomb is famous in Baghdad.

In Dhu al-Hijjah of the year 158 AH, Abu Ja'far Al-Mansur passed away while on a journey to perform the Hajj rituals. He was in a well about fifty miles from Mecca. His reign lasted for twenty-two years and a few days. He was sixty-two years old.