During May and June 2001, wrestlers identified as being "under contract to WCW" (such as Lance Storm and Mike Awesome) "invaded" WWF programming, by performing several run-ins during matches.

To test the waters for this, the final twenty minutes of the July 2 edition of Raw Is War was given over to WCW, which (in kayfabe) brought in its own commentators (Scott Hudson and Arn Anderson), ring announcer (Stacy Keibler), referee (Nick Patrick), ring apron, and Chyron graphics, to present a match between Booker T and Buff Bagwell for Booker T's WCW Championship (which he had won on the final episode of Nitro).

Later that evening, Vince and Shane agreed to put aside their differences and join forces to take out ECW once and for all in a twenty-man brawl between Team WWF (Hardcore Holly, Big Show, APA, and Billy Gunn), Team WCW (Chris Kanyon, Chuck Palumbo, Sean O'Haire, Shawn Stasiak, and Mark Jindrak), and the ECW invaders.

It was revealed that ECW had merged with WCW to form a "supergroup" to more effectively challenge the WWF and that Stephanie McMahon had purchased the defunct company.

Further, 20 WWF and Alliance members would square off in what was called the "Immunity Battle Royal", with the winner of the match keeping his job for one year regardless of whether his side won or not.

In the end, Team WWF (The Rock, Chris Jericho, The Undertaker, Kane, and Big Show) defeated Team Alliance (Stone Cold Steve Austin, Kurt Angle, Rob Van Dam, Booker T, and Shane McMahon) when Angle double-crossed The Alliance by turning on Austin while he was fighting The Rock during the closing stages of the match.

The next night on Raw, Mr. McMahon celebrated his victory by making a slow return to his villain character, aligning himself with The Alliance members that kept their jobs.

Later that night, he resumed his rivalry with Austin, who turned face by attacking Angle and aligning himself with a returning Ric Flair, who was revealed, in storyline, to have bought Shane and Stephanie's stock in the company prior to Survivor Series, making him the new co-owner of the WWF, along with McMahon.

After being "fired", Shane walked out on his own and congratulated his father for his victory, and spent most of the next eighteen months away from television; he would return to feud with Kane in 2003.

Co-owners McMahon and Flair decided that, since there were now two world championships in the company, a tournament would be set up at Vengeance on December 9 to crown an Undisputed WWF Champion.