[17] Eventually, the Balli Kombëtar joined the Nazi Germany-established puppet government as part of the German occupation of Albania and fought as an ally against communist guerrilla groups.

However, the Balli Kombëtar condemned any cooperation of the LNC with the Yugoslav partisans, whom it considered natural enemies of Albania, which would soon be a deal breaker.

With Italy on the brink of defeat in 1943, the Albanian National Liberation Movement (LANÇ) and the Balli Kombëtar organized a meeting in the village of Mukje.

The Allies too could not guarantee that Kosovo would be a part of Albania,[26] because they stood for the restoration of occupied nations under their borders as they existed prior to World War II.

[27][page needed] Their lukewarm attitude towards the British was also fostered by their desire to preserve the occupied united Albanian state under the borders drawn by the Italians in 1941, for they bitterly opposed and dreaded the loss of Kosovo and Debar to Yugoslavia once again, and feared that the Allies in their support of the Greeks might prevent them from claiming Chameria and deprive them of their southern provinces of Korçe and Gjirokaster, the heartland of their liberation movement.

[27][page needed] The Mukje Agreement immediately triggered a hostile reaction from the Yugoslav representative in Albania, Svetozar Vukmanoviċ.

He denounced the agreement and put pressure on the LANÇ to repute it immediately,[28][page needed] and Yugoslav Communist leader Milovan Đilas subsequently described the Balli Kombëtar as "Albanian Fascists".

Fearing reprisals from larger forces, the Balli Kombëtar made a deal with the Germans and formed a "neutral government" in Tirana which continued its war with the LANÇ and the Yugoslav Partisans.

By January 1943, in Southern Albania, some Partisan units fought alongside the Balli Kombëtar during the Battle of Gjorm where they defeated and routed the Italian troops.

The Communists almost immediately repudiated the Mukaj agreement, and fearing the British might open a second front in the Balkans and lend their support to the Ballists, they issued orders that the Balli Kombëtar be eliminated wherever it was found.

[27][page needed] By the Fall of 1943 the Ballists, assisted by German forces, were also involved in vicious fighting against the Northern Epirus Liberation Front in Southern Albania.

British liaison officers in Albania noted that the Communists were using the arms they received to fight fellow Albanians far more than to harass the Germans.

[37][better source needed] The west noted that the Communists could not have won without the supplies and armaments from the British, America and Yugoslavia,[37] and that the LANÇ were not afraid of murdering their own countrymen.

On 6 November 1943, Berlin announced that the regents and the assembly had formed a government headed by Kosovar Albanian Rexhep Mitrovica,[41] who had joined the Balli Kombëtar resistance movement in 1942 and spent much of the Italian period in prison in Porto Romano near Durrës.

In Vardar Macedonia, when it was a part of the independent state of Albania, the German and Ballist forces had occasional skirmishes with Yugoslav partisans.

Kicevo, which remained in the hands of Macedonian and Albanian Partisan units following the capitulation of Italy,[40] was attacked by the Ballists of Xhem Hasa in early November 1943.

[46][page needed] Fiqri Dine, Xhem Hasa and Hysni Dema, as well as three German Majors, also directed military campaigns against the Albanian and Yugoslav partisans.

[49] With the tables now turned in their favour many Ballists saw an opportunity to take their revenge upon their Serbian neighbours for the suffering they had endured over previous two decades, burning perhaps as many as 30,000 houses belonging to Serbs and Montenegrins.

During this time the region between Ballist held Novi Pazar and Chetnik controlled Raška, witnessed constant fighting between the Albanians, Yugoslav Muslims and Serbs in the narrow valley that separates the two towns.

The "Balli Kombëtar Çam" (Cham National Front), founded in 1943 by Nuri Dino, received full German support since they were willing to fight both Albanian and Greek Communist Partisans.

Their support was appreciated by the Germans: Lt Colonel Josef Remold remarked that "with their knowledge of the surrounding area, they have proved their value in the scouting missions".

[55] On 27 September (1943), combined German and Cham forces launched large scale operation in villages north of Paramythia: Eleftherochori, Seliani, Semelika, Aghios Nikolaos.

[68] The operation failed, thanks in no small part to infamous double agent Kim Philby, who leaked crucial details of the plan to the communist authorities who were consequently able to intercept many of the fighters upon arrival.