Gonzalo Pizarro, having thus gained an easy victory, marched on with his army in good order to the camp of Centeno, putting every person to death that came in the way. A considerable number of the dispersed royalists happened to seek safety in passing by the camp of Pizarro, which they found entirely deserted, insomuch that they were able to make use of the horses and mules belonging to the insurgent infantry to facilitate their flight, and even made a considerable booty in gold and silver. While the royalist cavalry were engaged vigorously with the insurgents, Bachicao, one of Gonzalos captains, believing that the royalists would be victorious, went over to them. After the victory was decided in favour of Gonzalo, Bachicao, imagining that his conduct had not been observed, and would remain unknown, or that he would be able to justify himself under some colourable pretence, returned to his post. But as his defection was known to Carvajal, he caused him to be instantly hung up, adding insulting raillery to his cruelty, calling him his dear comrade and using many other bantering expressions.

During this unfortunate battle, Centeno was so ill that he was carried on a kind of litter by six Indians, almost in a state of insensibility; yet, by the care and attention of some of his friends, he was saved after the defeat of his army. In this bloody engagement, which was fought near a place called Guarina, above three hundred and fifty men were slain on the side of the royalists, besides thirty more who were put to death in the pursuit by the insurgent cavalry. Among these were, the major-general Luis de Ribera, the captains Retamoso, Diego Lopez de Zuniga, Negral, Pantoia, and Diego Alvarez, with Friar Gonzalo of the order of Mercy, and several other persons of condition. The insurgents lost about an hundred men. After the battle, Carvajal pursued the fugitives at the head of the insurgent cavalry for several days, on the road towards Cuzco. He was very anxious to take the bishop of Cuzco, against whom he was much incensed for having joined Centeno and being present in the battle. The bishop however made his escape; but Carvajal gratified his revenge on several royalists whom he got up with, all of whom he hung up without mercy, among whom were a brother of the bishop and a Dominican friar. After the return of Carvajal from the pursuit, Gonzalo made a distribution of lands and Indians among his troops, engaging to put them into possession at a convenient opportunity. He likewise took great care of his wounded men, and caused the slain to be buried. He then sent Bovadilla with a detachment to the city of La Plata and the mines, to collect all the gold and silver that could be procured, and dispatched Diego de Carvajal, usually called the Beau, on a similar mission to Arequipa. Juan de la Torre was sent to take possession of Cuzco, where he put to death Vasquez de Tapia and the licentiate Martel.

After this favourable turn of affairs, Pizarro issued a proclamation by which all the soldiers who had served under Centeno were commanded to join his standard, under pain of death; granting an amnesty for all that passed, with the exception only of those principal leaders who had particularly exerted themselves for the royal cause. He then sent Pedro de Bustincia with a detachment, to oblige the curacas of Andaguaylas and the neighbouring districts to furnish provisions for his army. A few days afterwards Gonzalo repaired to Cuzco with about four hundred men, and used every effort to put himself into a situation for opposing the president; being so elated by the victory he had gained at Guarina over such superior numbers, that he and his followers believed themselves almost invincible.

While these things were going on in the south of Peru, the president marched by the mountain road for the valley of Jauja, accompanied by the troops which he had brought from the Tierra Firma, and those of the captains Diego de Mora, Gomez de Alvarado, Juan de Saavedra, Porcel, and the others that had assembled in Caxamarca. He sent orders likewise to Salazar, who now commanded at Quito, to join him with all his men; and ordered Lorenzo de Aldana to join him from Lima with all the soldiers from the fleet and those he had drawn together after the flight of Gonzalo to Arequipa. The president arrived first of all at Jauja with an escort of an hundred men, where he immediately took the proper measures for collecting arms and military stores, and provisions. On the same day he was joined by the licentiate Carvajal and Gabriel de Royas; and soon afterwards Ferdinand Mexia de Guzman, and Juan Alphonzo Palamino arrived with their companies. Lorenzo de Aldana remained at Lima with his own company, it being of great importance to keep possession of that city and its post. In a short time the president had collected an army of above fifteen hundred men in Jauja, and employed all the forges and artists he could procure to fabricate new musquets, to put all the old ones into good repair, and to provide abundance of pikes and all other arms, both offensive and defensive. In these preparations he not only exerted the utmost diligence, but shewed a great deal of intelligence and knowledge, far beyond what could tare been expected from a person who had hitherto been entirely occupied in civil and religious pursuits. He carefully visited his camps, and inspected the workmen who were employed by his orders, taking at the same time every possible care of such of his soldiers as were sick, exerting himself to the utmost in every thing relative to the good of the service, beyond what could have been expected from any single person, by which means he acquired the entire confidence and affection of all who were under his command. His army had always been in hope that their services would not be required, and even at one time believed that the president would not have had occasion to assemble an army, as they thought that Centeno was strong enough to have conquered Gonzalo.

Immediately on receiving intelligence of the victory which Gonzalo had gained at Guarina, the president sent the captains Lope Martin and Mercadillo, with a detachment of fifty men, to occupy the passes of Guamanga, about thirty leagues from Jauja on the way to Cuzco, to learn the motions of the enemy, and to collect all who might have been able to escape from Cuzco. While at Guamanga, Lope Martin got notice that Pedro de Bustincia was in the district of Andahuaylas collecting provisions for the army of Gonzalo, as formerly mentioned. Accompanied by fifteen mounted musqueteers, Martin went into that district, where he unexpectedly attacked Bustincia during the night, and made him and all his people prisoners. After hanging some of these men, he returned to Guamanga, bringing all the curacas of the neighbourhood along with him, by whose means intelligence was conveyed to all parts of the country, giving notice of the arrival of the president in the valley of Jauja, and the great preparations he was making in that place.

From Jauja the president sent his lieutenant-general, Alfonzo de Alvarado, to bring up from Lima all the soldiers that could be spared from that place, together with some pieces of artillery from the ships, and clothes and money for the supply of such of the soldiers as were in want; all of which services were performed by Alvarado in a short time. The president now mustered his army, of which Pedro Alfonzo de Hinojosa was lieutenant-general, and the licenciate Bendicto de Carvajal carried the royal standard, Don Pedro de Cabrera, Gomez de Alvarado, Juan de Saavedra, Diego de Mora, Francisco Hernandez, Rodrigo de Salazar, and Alfonzo de Mendoza were captains of cavalry; Don Balthazar de Castillo, Pablo de Menezes, Hernando Mexia de Guzman, Juan Alfonzo Palomino, Gomez de Solis, Francisco Mosquera, Don Ferdinand de Cardinas, the adelantado Andagoya, Francisco d'Olmos, Gomez d'Arias, and three other captains, Porcel, Pardaval, and Serna, commanded the infantry. Gabriel de Royas was appointed to command the artillery. Besides the military officers already mentioned, the president was attended by the archbishop of Lima, the bishops of Cuzco and Quito, the provincials of the Dominicans and of the order of Mercy, and by several other ecclesiastics, both priests and friars. On a general muster and review of the army, it was found to consist of seven hundred musqueteers, five hundred pikemen, and four hundred cavalry. Afterwards, on arriving at Xaquixaguana on the march towards Cuzco, it was augmented to nineteen hundred men, by the junction of several other detachments, forming the largest and best appointed array hitherto seen in Peru.