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In 1970, Dunn decided to run for the Republican nomination for governor of Tennessee.
The party had not even fielded a nominee in the gubernatorial election four years prior, but suddenly the nomination seemed valuable, in large measure to the factors cited above, and in the primary Dunn defeated four opponents, including 1962 Republican nominee Hubert Patty, then-Speaker of the Tennessee House of Representatives ( and future 1st District-Congressman ) William L. Jenkins, Claude K Robertson, Knoxville attorney, and industrialist Maxey Jarman, head of Genesco Corp. Harry W. Wellford ( then a private attorney but later U. S. District Court and then U. S. 6th Circuit Court of Appeals Justice ) served as Dunn's campaign chair and closest confidant.
Wellford had also managed the campaign of Howard Baker's successful U. S. Senate bid 4 years earlier.
After winning the Republican nomination, Dunn narrowly defeated Democratic attorney and entrepreneur John Jay Hooker and became the first Republican elected governor of Tennessee in half a century.
During his tenure, Dunn was a member of the National Governors ' Conference Executive Committee from 1971 – 1973, and he chaired the Education Commission of the States from 1972 to 1973 and the Republican Governors Association from 1973 to 1974.
The Tennessee State Constitution did not allow governors to succeed themselves at the time that Dunn's term expired in 1975.
He did not return to his dental practice in Memphis, but became a successful businessman in Nashville.

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