It would appear that Paillamachu had formed confident hopes in the successful issue of this bold enterprise, and that it had been long concerted: as, in consequence of his instructions, the whole provinces of the Araucanian confederacy, and their allies the Cunches and Huilliches, were in arms in less than forty-eight hours after the slaughter of Loyola. In the whole of that country, from the Biobio to the archipelago of Chiloe, every Spaniard who had the misfortune to be found without the garrisons was put to death; and the cities and fortresses of Osorno, Valdivia, Villarica, Imperial, Canete, Angol, and Arauco, were all invested at the same time by close blockades. Paillamachu had even the boldness to cross the Biobio, burned the cities of Conception and Chillan, laid waste the provinces under their dependence, and returned into Araucania loaded with spoil.

On the first intelligence of these melancholy events, the inhabitants of St Jago were filled with consternation and despair, and were almost unanimously of opinion to abandon Chili and take refuge in Peru. Yet, having some confidence in Pedro de Viscara, an officer of reputation then beyond seventy years of age, they assembled in council and prevailed on him to assume the government of the kingdom till the court might appoint a successor to Loyola. Viscara, having collected all the troops that could be procured, began his march for the frontiers in 1599, and had even the courage to cross the Biobio in the face of the enemy, and withdrew the inhabitants from Angol and Coya, with whom he repeopled the cities of Conception and Chilian. The government of Viscara only continued for six months; as on learning the perilous situation of Chili, the viceroy of Peru sent Don Francisco Quinones thither as governor, with a numerous reinforcement of soldiers and a large supply of military stores. The new governor had several indecisive actions with the toqui to the north of the river Biobio, to which the Araucanians had gone on purpose to ravage the southern provinces of Spanish Chili. The most important of these was in the plain of Yumbal. The toqui was on his return into the south from a successful inroad at the head of two thousand men, and with a great number of cattle of all kinds which he had taken in the province of Chillan, and Quinones attempted to intercept his retreat with an equal force, the greater part of which consisted of Spanish troops. The two armies advanced with equal resolution, and the Spaniards attempted in vain to keep the Araucanians at a distance by a constant fire from eight field pieces and all their musquetry. They soon came to close quarters, and the battle continued with incredible fury for more than two hours, till night parted them; when Paillamachu took advantage of the darkness and repassed the Biobio. On this occasion, the governor made an improper display of severity, by ordering all his prisoners to be quartered and hung upon trees, which was much disapproved of by his officers, who, either from humanity or a motive of self-interest, urged him not to give the enemy a pretence for retaliating by similar cruelties. But Quinones obstinately adhered to an old maxim of endeavouring to conquer by means of terror, and was deaf to all their remonstrances. We are ignorant of the loss sustained by the Spaniards in this battle, but it must have been considerable, as Arauco and Canete were both immediately abandoned, and their inhabitants withdrawn to the city of Conception.

Paillmachu does not seem to have been at all disconcerted by the issue of the late battle, as he continued the sieges of the Spanish cities, and was himself in constant motion; sometimes encouraging by his presence the forces that were employed in blockading the cities, and at other times ravaging the Spanish provinces to the north of the Biobio, where he did infinite mischief. Having learnt that the siege of Valdivia had been raised by the officer whom he had entrusted with that enterprise, he hastened to that place with four thousand men, part cavalry, seventy of his infantry being armed with musquets which he had taken from the Spaniards in the late engagements. On the night of the 14th of November91 he crossed the broad river of Calacala by swimming, unsuspected by the garrison, stormed the city at day-break, killed a great number of the inhabitants, and burnt the houses. He even attempted to gain possession of some vessels in the harbour, on board of which many of the inhabitants had taken refuge, but these escaped his fury by immediately setting sail. After this notable exploit, he returned in triumph into the north of Araucania with a booty of two millions of dollars, upwards of four hundred prisoners, and a considerable number of cannon; and rejoined Millacalquin, an officer to whom he had entrusted the defence of the Biobio during his absence.

Ten days after the destruction of Valdivia, Francisco del Campo arrived there by sea from Peru with a reinforcement of three hundred men; and finding it in ashes, he ineffectually endeavoured to introduce these succours into Osorno, Villarica, and Imperial92. Amid so many misfortunes, an expedition of five ships from Holland arrived on the coast of Chili in 1660, which plundered the island of Chiloe and put the Spanish garrison to the sword. But on a part of their people landing in the island of Talca or Santa Maria93, inhabited by the Araucanians, they were repulsed with the loss of twenty-three men, being probably mistaken for Spaniards.

Disgusted with a war which threatened such unfortunate consequences, Quinones solicited and obtained leave to resign the government of Chili, and was succeeded by Garcia Ramon who had long been quarter-master of the army in that kingdom. Great expectations were formed of success in the war against the Araucanians under his direction, from his long experience and thorough acquaintance with the manner in which the enemy carried on their warlike operations. But that experience induced him to conduct the war on prudent principles of defence, rather than to hazard the loss of that part of Chili which was subject to Spain. Although he received a reinforcement consisting of an entire regiment of veterans, under the command of Don Francisco de Ovalle, father to the historian of that name, he confined himself almost entirely to the defence of the frontier line upon the Biobio. Garcia Ramon was however soon superseded in the government by the appointment of Alonzo Rivera, an officer who had acquired considerable reputation in the wars in the low countries, and who now brought out a farther reinforcement of a regiment of veteran troops. On assuming the government, he established a number of additional forts on the river Biobio, to defend the frontiers, by which he greatly encouraged the Spanish colonists, who still entertained an idea of abandoning Chili to the enemy.

The populous and opulent city of Villarica, fell into the hands of the Araucanians in 1692, after a siege or blockade of two years and eleven months; and soon afterwards Imperial, the capital of the Spanish settlements beyond the Biobio, experienced a similar fate. The defence of this city was protracted for some months by the courage of a Spanish lady, named Donna Innes de Aguilera. Seeing the garrison quite dispirited by the long continuance of the siege, and ready to capitulate, she encouraged them to persist in its defence, and even directed all the operations in person; until at last, on a favourable opportunity offering, she escaped by sea with the bishop and most of the inhabitants. During this siege, she lost her husband and brothers, and her heroism was rewarded by the king with a pension of two thousand dollars.

Osorno, likewise a rich and populous city, soon followed; as the enemy, now freed from the attention they had hitherto given to Valdivia, Villarica and Imperial, were able to bring their whole force against that last possession of the Spaniards within the territories of the Araucanian confederacy. The sufferings endured by the garrison and inhabitants of Osorno are scarcely to be exceeded by those endured in the most celebrated sieges recorded in history. They were long obliged to subsist on the most loathsome food, having no other sustenance than the carcasses of dead horses; and when these failed on cats and dogs and the skins of beasts. Thus in little more than three years, all the settlements which had been established by Valdivia and his successors, between the river Biobio and the archipelago of Chiloe, and preserved at the expence of so much blood, were destroyed, and so effectually that hardly any vestiges of them now remain. None of them have been since rebuilt, as what is at present called Valdivia is nothing more than a garrison or fortified post. Though great numbers of the inhabitants of these cities perished in the defence of their walls, by famine or by the sword of the enemy, yet Spanish prisoners of all ranks were so numerous among the Araucanians, that almost every family had at least one to its share. The married Spaniards were mostly allowed to retain their wives, and the unmarried men were supplied with wives from among the women of the country; but the unmarried Spanish women were distributed among the chiefs of the Araucanians, who by their customs were permitted a plurality of wives. It is not a little remarkable that the mestees, or offspring of these marriages, became in the subsequent wars the most inveterate enemies of the Spaniards.