I would start looking for another job. Do the best you can meanwhile, but really start looking, even if it's a demotion. It can be a tough decision to make to leave a job especially if it means moving companies, but sometimes it's the best thing to do.
I was a server tech at a hospital for a few years. The job itself was exactly what I wanted to do from day 1 when I got out of college. I was a contractor but stationed there full time so the IT manager was essentially my boss and I never talked that often to my real boss other than the occasional meeting. That IT manager was the biggest asshole I've ever met. First year was not so bad, then things just got worse, he was harder and harder on me (well all of us), and overall was poisoning the environment. There was constant tension. I could write a book on him, so I wont go into details here. It got to a point where I kept asking myself why I'm dealing with that crap and had to do something about it. I came really close to booking a meeting with the CEO (really nice guy) to talk to him about it. But I was scared it could backfire given I'm not even a real employee there, so never went that route.
I had seen a NOC position come out in my company at one point and thought about it, but never applied. Maybe a year later another NOC position came out. I figured, know what, I'm applying. I applied for it, and got it. A year later, the only thing I regret is not applying sooner! Best job ever. Low stress, flexible hours, and actually higher pay than the last due to shifts, more overtime, etc.
Dealing with that kind of stress just builds up on you after a while, so it's best to look into moving away from it before it eats you alive. Just don't jump ship too quick either, make sure whatever job you find will still last. Don't jump on a good job only to find out it's temporary.