In 818, after he reneged on an offer to submit three of Pinglu's 12 prefectures to imperial control, Emperor Xianzong declared a campaign against him.
When Li Shidao consulted his staff members, some suggested pillaging the nearby circuits to create pressure on the imperial government.
Meanwhile, the chancellor Du Huangchang advocated trying to strip Li Shidao of some territory, but as Emperor Xianzong was waging a campaign against another warlord, Liu Pi, at the time, he did not want to create another battlefront.
Li Shidao offered to use his own money to pay off Wei Chou's mortgage, and Emperor Xianzong initially agreed.
[6] In 814, another ally of Li Shidao's, Wu Shaoyang the military governor of Zhangyi Circuit (彰義, headquartered in modern Zhumadian, Henan), died.
Both LI Shidao and Wang Chengzong tried to intercede on Wu Yuanji's behalf, but Emperor Xianzong rebuffed them.
[6] Meanwhile, some tens of assassins that Li had retained were suggesting to him that the way for him to save Zhangyi would be to use guerilla warfare—retain a group of bandits to burn the imperial food supplies around the eastern capital Luoyang such that the imperial government would be forced to concentrate on Luoyang's security and decrease the pressure on Zhangyi.
[6] Li's assassins then suggested the next move—assassinate the chancellor Wu Yuanheng, whom Emperor Xianzong had put in charge of the logistics of the operations against Zhangyi.
Emperor Xianzong thus declared Wang a renegade, while, at that point, not suspecting Li, and his assassins were able to flee Chang'an without being arrested.
When some officials suggested ending the campaign against Zhangyi, Emperor Xianzong firmly refused, and further made Pei chancellor.
He had a detachment of Pinglu soldiers stationed at Luoyang, serving as his liaisons, and they were led by the Buddhist monk Yuanjing (圓淨), who had previously been an officer under Shi Siming during the Anshi Rebellion.
Emperor Xianzong agreed, but as he was already waging two campaigns simultaneously against Wu and Wang, he could not declare a third one against Li at that time.
Emperor Xianzong, having no ability to attack him at the moment, gave him the honorary title of acting Sikong (司空, one of the Three Excellencies).
When Liu returned to Pinglu, however, he reported to Li that Wu was not diligent, was wasting time in games with his wife and concubines, and was not able in military matters.
Li, who had hoped for a more optimistic report, did not want to hear this, and he soon thereafter found an excuse to put Liu to death.
[7] As the Song dynasty historian Hu Sanxing commented:[8] Someone who could observe the details as Liu Yanping did must have uncommon knowledge and reason.
Wang again offered to surrender two of his six prefectures to imperial control and further sent his two sons to Chang'an to serve as hostages, and Emperor Xianzong accepted his submission.
[7] However, it was said that by this point, Li Shidao was only often conferring on the key matters with his wife Lady Wei, household servants Hu Weikan (胡惟堪) and Yang Ziwen (楊自溫), the female servants Ladies Pu and Yuan, and the scribe Wang Zaisheng (王再升).
That night, Liu informed the army the events that were occurring and stated that he was intending to make a surprise attack on Yun Prefecture and submit to imperial authority.
Later, the new military governor Ma Zong (馬總) reburied Li Shidao's body with ceremony due a scholar, not a general.