Asen was murdered in Tarnovo by the boyar Ivanko in the fall of 1196. Theodor-Peter soon mustered his troops, hurried to the town and laid siege to it. Ivanko sent an envoy to Constantinople, urging the new Byzantine Emperor, Alexios III Angelos, to send reinforcements to him. The emperor dispatched Manuel Kamytzes to lead an army to Tarnovo, but fear of an ambush at the mountain passes led to an outbreak of mutiny and the troops forced him to return. Ivanko realized that he could not defend Tarnovo any more and fled from the town to Constantinople. Theodor-Peter entered Tarnovo. After making his younger brother Kaloyan the ruler of the town, he returned to Preslav.

Theodor-Peter was murdered "in obscure circumstances" in 1197. He was "run through by the sword of one of his countrymen", according to Choniates' record. Historian István Vásáry writes, Theodor-Peter was killed during a riot; Stephenson proposes, the native lords got rid of him, because of his close alliance with the Cumans.