During World War II the Comintern sent him back to Vardar Macedonia (being then part of the Kingdom of Yugoslavia under the name 'Vardarska Banovina') to serve as a Secretary of the Macedonian Regional Committee of the Yugoslav Communist Party (YCP) since 1940.
After the Bulgarian takeover of Vardarska Banovina in April 1941, the Vardar Macedonian communists fell in the sphere of influence of the BCP under Sharlo's leadership.
[8] The Macedonian Regional Committee refused to remain in contact with the YCP and linked up with BCP as soon as the invasion of Yugoslavia started.
[citation needed] Consequently, for his actions Sharlo was expelled from the YCP and in the late 1941 he moved again to Sofia, where he began working as one of the Bulgarian resistance movement leaders (under the nickname 'Panayot').
Sharlo was heavily wounded and died under unknown circumstances after September 5, 1944, when a battle between partisans and gendarmerie on Milevi Skali in the Western Rhodope mountains, between Septemvri and Velingrad occurred.
[13] This happened only several days before the Communist coup d'état of September, 9 (backed by the Red Army) installed a new government of the Fatherland Front.
[14] Shatorov's supporters in Vardar Macedonia called Sharlisti, were criticised by the YCP, and after WWII repressed for their anti-Yugoslav and pro-Bulgarian political positions.