Why do opposition parties struggle to challenge aspiring autocrats in elections? I argue that elite economic coercion–the credible threat of economic retaliation against opposition-aligned elites–plays a central, overlooked role. Authoritarian ruling parties leverage control over state institutions and resources to punish opposition candidates and their families through firings, blacklisting, tax audits, and denials of state contracts. This deters political entry, erodes opposition candidate quality, and diminishes opposition parties’ electoral appeal. Focusing on Hungary’s autocratization episode, I leverage three original data sources for evidence. Using newly assembled panel data on the near-universe of firms linked to candidates, I document widespread economic retaliation upon opposition political entry. A survey experiment with opposition elites reveals that such retaliation reduces political ambition. New data on candidate backgrounds indicate a decline in opposition quality, in large part driven by the deterrence of individuals in high-skilled, state-dependent occupations. The findings highlight the key role of autocrats’ coercive economic retaliation in preventing successful opposition challenge during democratic decline.