It was a precursor to the Peninsular Wars, resulting in the Treaty of Badajoz, the loss of Portuguese territory, in particular Olivenza, as well as ultimately setting the stage for the complete invasion of the Iberian Peninsula by French forces.

The Portuguese garrison of Campo Maior - under the command of Lieutenant-Colonel Dias Azevedo - resisted the assault for 17 days, forcing the Spanish to maintain two entire divisions in its siege.

The war entered in a stalemate, with most of the Spanish forces held in sieges of fortresses and the rest not being able to face the blockade made by the main core of the Portuguese Army, in order to advance further inside Portugal.

Portugal agreed to close its ports to English ships, to give commercial concessions to France, to cede Olivenza to Spain and to pay an indemnity.

In response, from July 1801 until the signing of the Peace of Amiens in 1802, a British force of 3,500 men under Colonel William Henry Clinton occupied the Portuguese island of Madeira in the North Atlantic Ocean.