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The village of Nomonhan sat near the border in an area disputed between Mongolia and the Japanese puppet state of Manchukuo in northeastern China. The Japanese argued that the river Khalkhin Gol was the border, while the Mongolians insisted that the border was 16 kilometers east of the river, just east of the village of Nomonhan.

On 11 May 1939, a small Mongolian cavalry unit marched near Nomonhan in search of grazing land for their horses, and was driven out by Manchurian cavalry. Two days later, the enraged Mongolians returned with a sizeable force and occupied the territory. The aggressive Japanese Kwantung Army took this incident as an excuse to move into Russian sphere of influence, and dispatched Colonel Takemitsu Yamagata and Lieutenant Colonel Yaozo Azuma into Mongolia on 14 May with two regiments from the Japanese 23rd Division. They were able to drive the Mongolian forces back across the river. Shortly after, Mongolian troops returned, and Azuma returned with his troops again, but this time, the Japanese were surrounded by Russian and Mongolian troops, and the Japanese troops were wiped out on 28 May; the Japanese lost 8 officers and 97 men killed and 1 officer and 33 men wounded, a total of 63% casualty rate.

Immediately after this engagement, both sides built up strength in the area. While the Japanese moved 30,000 men toward Mongolia, while Moscow dispatched Lieutenant General Georgi Zhukov to lead an offensive. Zhukov arrived in the area on 5 Jun 1939 with armored cars and tanks. On 27 Jun, the Japanese 2nd Air Brigade attacked the airfield at Tamsak-Bulak in Mongolia, and both sides lost several aircraft; this attack was conducted by the Kwantung Army without approval from Tokyo, and after learning of the attack, Tokyo ordered that no further air strikes were to be launched.

At the end of Jun 1939, Lieutenant General Komatsubara Michitaro of the Japanese 23rd Division was given the permission to attack. He planned for a two-pronted approach, with one marching at Baintsagan Hill and then Kawatama Bridge, and the other would attack Soviet positions on the east bank of the river Khalkhin Gol and north of the Holsten River. As the first prong crossed the Khalkhin Gol, Zhukov launched a counterattack with 450 tanks and armored cars without infantry support. The Russian armored force attacked the Japanese on three sides, forcing the Japanese to fall back over the river on 5 Jul. Meanwhile, the second prong (Yasuoka Detachment, named after the commanding officer Lieutenant General Masaomi Yasuoka), attacked beginning on the night of 2 Jul; the second prong suffered the loss of over half of its armored vehicles, and was driven back by a Soviet counterattack on 9 Jul. Over the next two weeks, the two sides continuously engaged each other, though none of the engagements were significant. As the Japanese logistics began to show signs of strain due to limited number of trucks available, Zhukov was able to assemble a force of 2,600 trucks to supply his troops. On 2 Jul, the Japanese launched another major assault, sending the 64th and 72nd Regiments to attack the Soviet forces at the Kawatama Bridge. The attack began with a two-day artillery bombardment, but the infantry was not able to take the bridge, and the attack was withdrawn on 25 Jul. The Japanese officers planned to regroup over the following month for another strike at the end of Aug. They would not be given the chance.

On 20 Aug 1939, Zhukov crossed the river with a 57,000-strong force consisted of 498 tanks, motorized infantry, an air wing with 250 aircraft, and two Mongolian cavalry divisions. Opposing them, the Japanese only fielded two light armor divisions. As the overwhelming Soviet forces pinned down Kwantung Army's veteran forces near the river, Russian tanks broke through and attacked the Japanese in the rear, achieving envelopement by 25 Aug. On 26 Aug, the Japanese launched an attack to relieve the surrounded 23rd Division, but the attack failed. On 27 Aug, the 23rd Division mounted a determined break-out attempt, but also failed. By 31 Aug, the surrounded Japanese troops were completely wiped out.

On 15 Sep 1939, the Japanese signed a ceasefire to be in effect on the following day, and agreed to honor the borders claimed by Mongolia. The Japanese suffered between 20,000 to 50,000 casualties (at least 8,400 killed) out of 75,000 troops committed; the Soviets suffered 23,499 casualties (8,248 killed) out of 57,000 troops committed. For the victory, Zhukov won his first Hero of the Soviet Union award and was promoted to the rank of general.

This battle was known in Japan as the Nomonhan Incident, Battle of Khalkhin Gol in Russia, and the Battle of Halhin Gol in Mongolia.

The result of the battle significantly influenced the future direction of Japanese expansion. Due to the inability to expand into Mongolia, the Japanese Army lost prestige at the IGHQ in Tokyo. The Navy, stepping up to fill the void that the Army had once occupied, and gained support for its plan to invade southern Pacific for its natural resources. Additionally, the ceasefire signed between Russia and Japan on 15 Sep 1939 (to be in effect on the following day) allowed the Russia to divert part of its strength in Siberia to later bolster the defense against the German attack on Moscow.

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