After the defeat at the Battle of Tucapel, the Spanish had hurriedly reorganized their forces, reinforcing fort La Imperial for its defense and abandoning Confines and Arauco in order to strengthen Concepción. Araucanian tradition had dictated a lengthy celebration after their victory, which kept Lautaro from exploiting the weakness of the Spanish position as he desired. It was only in February 1554 that he succeeded in putting together an army of 8,000 men, just in time to confront a punitive expedition under the command of Francisco de Villagra at the Battle of Marihueñu.
Lautaro chose the hill of Marihueñu to fight the Spanish, and subsequently organized his forces in four divisions: two had the mission of containing and wearing down the enemy, another would be held in reserve to launch a fresh attack as the Spanish were about to crumble, and the last would work to cut off their retreat. Additionally, a small group was sent to destroy the reed bridge the Spanish had erected across the Bío-Bío River, which would disrupt even more the attempted retreat of Villagra.
The Spanish attack broke the first Mapuche lines, but the quick action of the third group maintained the Mapuche position. Later, the wings of this division began to attack the Spanish flanks, and the fourth division attacked from behind. After hours of battle and the loss of their artillery, only a small group of Spanish were able to retreat after a desperate fight to break through the Mapuche that blocked their escape in their rear.