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The Royalists meanwhile retreated to the south. On February 18, 1818, the independence of Chile was proclaimed. A month later the Patriots were surprised at Cancha-Rayada and almost routed, but within two weeks the army was again ready for action, and on April 5, 1818, encountered the Royalists at Maipo. This battle was a complete victory for the Patriots and decided the fate of Chile.

Later, he fought the decisive battle of Maipo, passing then to Santiago, where he was proclaimed director of the state, from which position he immediately resigned, using all his influence to have O'Higgins appointed in his stead, which was done. O'Higgins was an honest man and an excellent administrator.

Only one or two fortresses in the south were now held for Spain. Five days after the battle of Maipo, San Martin returned once more to Buenos Aires and began organizing an expedition for the liberation of Peru. Puyrredon, now Supreme Director, supported his undertaking. While San Martin was soliciting aid from the Argentine Republic, the Chileans were not idle.

San Martin, meanwhile, had been collecting reinforcements with which to strike the final blow. On the 5th of April, the Battle of Maipo gave him the victory he desired. Except for a few isolated points to the southward, the power of Spain had fallen. Until the fall of Napoleon in 1815 it had been the native loyalists who had supported the cause of the mother country in the Spanish dominions.