The Imperial Japanese Navy responded to this attack with a combined fleet attack that led to the Battle of Leyte Gulf between 23 October and 26 October. In this massive naval engagement, the Japanese Navy was destroyed as a strategic force. However, this was not at first clear, and the Japanese commander in the Philippines, General Tomoyuki Yamashita, believed that the United States Navy had suffered severe casualties and that the Allied land forces might be vulnerable. Accordingly, he began to reinforce and resupply the garrisons on Leyte; over the course of the battle the Japanese ran nine convoys to the island, landing around 34,000 troops from the 1st, 8th, 26th, 30th, and 102nd divisions. Ormoc City at the head of Ormoc Bay on the west side of Leyte was the main port on the island and the main destination of the convoys.
Decryption of messages sent using the PURPLE cipher alerted the Allies to the concentration of Japanese shipping around Leyte, but they initially interpreted this as an evacuation. However, by the first week of November the picture was clear, and the Allies began to interdict the convoys.
Four destroyers — Shimakaze, Wakatsuki, Hamanami, Naganami — and five transports were sunk. Rear Admiral Mikio Hayakawa went down with Shimakaze.
An Allied patrol plane radioed a message to the division noting that a surfaced Japanese submarine (the I-46) was south of Pacijan Island and heading for Ormoc Bay. The division headed south to intercept; and, at 01:27 on 28 November, Waller's radar picked up the target just off the northeast coast of Ponson Island. Waller disabled the submarine with her first shots and, unable to submerge, I-46 could only return fire with her deck guns until she sank at 01:45.
Another U.S. destroyer sweep on the night of 29 November–30 November in search of a reported convoy resulted only in the destruction of a few barges.
The convoy was docked at Ormoc City when it was engaged at 00:09 on 3 December by three ships of U.S. Destroyer Division 120 (DesDiv 120) under the command of Captain John C. Zahm (Allen M. Sumner, Cooper and Moale).
The U.S. ships sank the transports as they were unloaded but came under heavy attack from Yokosuka P1Y "Frances" bombers, shore batteries, submarines that were known to be in the harbor, and the Japanese destroyers. Kuwa was sunk and Commander Yamashita was killed. Take attacked Cooper with torpedoes and escaped, though with some damage. Cooper sank at about 00:15 with the loss of 191 lives (168 sailors were rescued from the water on 4 December by PBY Catalina planes). At 00:33, the two surviving U.S. destroyers were ordered to leave the bay. This phase of the Battle of Ormoc Bay has gone down in history as the only naval engagement during the war in which the enemy brought to bear every type of weapon: naval gunnery, air attack, submarine attack, shore gunnery and mines.
On 5 December 1944, United States Marines made a landing at San Pedro Bay, 27 miles (43 km) south of Ormoc City. The landing craft and support vessels came under sustained kamikaze air attack. Fifteen craft were sunk, and destroyers USS Mugford and USS Drayton were hit, suffering about 50 casualties.
On 7 December, the 77th Infantry Division, commanded by Major General Andrew D. Bruce, made an amphibious landing at Albuera, 3.5 miles (5.5 km) south of Ormoc City. The 77th Division's 305th, 306th, and 307th Infantry Regiments came ashore unopposed, but naval shipping was subjected to kamikaze air attacks, resulting in the loss of destroyers USS Ward and USS Mahan.
Convoy TA-9 entered the bay on 11 December and landed troops, but two escorting destroyers, Juzuki and Uzuki, were sunk and the third, Kiri, was damaged.
Historian Irwin J. Kappes argued that naval historians have unjustly neglected the importance of these engagements, writing: