Incessant fighting followed the Mukden Incident. In 1932, Chinese and Japanese troops fought the January 28 Incident battle. This resulted in the demilitarisation of Shanghai, which forbade the Chinese from deploying troops in their own city. In Manchukuo there was an ongoing campaign to defeat the Anti-Japanese Volunteer Armies that arose from widespread outrage over the policy of non-resistance to Japan.
After five months of fighting, Japan established the puppet state of Manchukuo in 1932, and installed the last Emperor of China, Puyi, as its puppet ruler. Militarily too weak to challenge Japan directly, China appealed to the League of Nations for help. The League's investigation led to the publication of the Lytton Report, condemning Japan for its incursion into Manchuria, causing Japan to withdraw from the League of Nations. No country took action against Japan beyond tepid censure.