The Count of Eu and the main Allied troops advanced and took Caacupé on August 15, though López had already moved to Caraguatay, leaving Bernardino Caballero to guard the rear.

In an attempt to block the Paraguayan Army from retreating to Caraguatay, the Count of Eu sent a cavalry division to Barrero Grande (now Eusebio Ayala), while the 1st Corps pursued López.

Before engaging Caballero at Acosta Ñu, the cavalry division was reinforced by the Brazilian army's 2nd Corps, including Argentine soldiers under the command of Col. Luis María Campos.

[4] The battle began at 8:30 in the morning in on Campo Grande, also known as Acosta Ñu ('Acosta's Field'), an open plain of about 12 square kilometres (4.6 sq mi) favorable to the Brazilian cavalry.

Some scholars, such as Julio José Chiavenatto, accused the Count of Eu of ordering fires set to kill fallen soldiers, including burning a field hospital.