Relations between the United States and Spain deteriorated over the conduct of the war for independence in Cuba. On February 15, 1898 the American battleship, USS Maine, exploded and sank in Havana harbour under mysterious circumstances with the loss of 260 men.

As war between the United States and Spain became imminent, the commander of the U.S. Asiatic Squadron, Commodore George Dewey, had discussions with Emilio Aguinaldo's government in exile in Singapore and Hong Kong.

On April 25, 1898, the United States declared war on Spain and the Secretary of the Navy, Theodore Roosevelt, ordered Dewey to attack the Spanish fleet in the Philippines. The Battle of Manila Bay was the first hostile engagement of the Spanish-American War. In the darkness before dawn, Commodore Dewey's ships passed under the siege guns on the island of Corregidor at the entrance to Manila Bay and by noon on May 1, 1898 had destroyed the Spanish fleet.

Aguinaldo arrived back in the Philippines on May 19, 1898 and resumed command of his rebel forces. The Filipino rebels routed the demoralized Spanish forces in the provinces and laid siege to Manila. From the balcony of his house in Cavite, Emilio Aguinaldo proclaimed the independence of the Philippines on June 12, 1898.

Whatever understanding Dewey and Aguinaldo may have reached in Hong Kong prior to the war, neither could have appreciated the full extent of the geopolitical forces at play. By late May, the newly appointed Admiral Dewey had received intructions to distance himself from Aguinaldo and his independence cause.

The United States had not expressed an interest in taking over the remnants of Spain's colonial empire. On news of Dewey's victory, warships began arriving in Manila Bay from Britain, France, Japan and Germany. The German fleet of eight warships was especially aggressive and menacing. All of these imperial powers had recently obtained concessions from China for naval bases and designated commercial spheres of interest. American interests had reason to fear that leaving the Philippines to the designs of the imperial powers might exclude the United States from the Asia-Pacific trade altogether.

As it became apparent that the United States did not intend to recognize Philippine independence, Aguinaldo moved his capital in September from Cavite to the more defensible Malalos in Bulacan. That same month, the United States and Spain began their peace negotiations in Paris.

The Treaty of Paris was signed on December 10, 1898. By the Treaty, Cuba gained its independence and Spain ceded the Philippines, Guam and Puerto Rico to the United States for the sum of US$20 million.

Disappointed at having lost the opportunity to acquire the Philippines as a colony, Germany applied diplomatic pressure during the Paris negotiations to block the American request for the Caroline Islands. Spain subsequently sold the Caroline and Marianas Islands (less Guam) to Germany.

The Treaty of Paris was not well received in the Philippines. Filipino nationalists were incensed at the arrogance of the imperial powers to bargain away their independence for the tidy price of US$20 million with not so much as a pretence of consultation with Filipinos.

Aguinaldo did not need recommendations to decide what he would do. On January 23, 1899 he proclaimed the Malalos Constitution and the First Philippine Republic.

The hostilities in the Philippine War of Independence began on February 4, 1899 and continued for two years. The United States needed 126,000 soldiers to subdue the Philippines. The war took the lives of 4,234 Americans and 16,000 Filipinos. As usually happens in guerrilla campaigns, the civilian population suffers the worst. As many as 200,000 civilians may have died from famine and disease.

As before, the Filipino rebels did not do well in the field. Aguinaldo and his government escaped the capture of Malalos on March 31, 1899 and were driven into northern Luzon. Peace feelers from members of Aguinaldo's cabinet failed in May when the American commander, General Ewell Otis, demanded an unconditional surrender.

Aguinaldo disbanded his regular forces in November and began a guerrilla campaign concentrated mainly in the Tagalog areas of central Luzon. Aguinaldo was captured on March 23, 1901. In Manila he was persuaded to swear allegiance to the United States and called on his soldiers to put down their arms.