During the Russo-Japanese War, the Russian Baltic Fleet is nearly destroyed at the Battle of Tsushima Strait. The decisive defeat, in which only 10 of 45 Russian warships escaped to safety, convinced Russian leaders that further resistance against Japan's imperial designs for East Asia was hopeless.
On February 8, 1904, following the Russian rejection of a Japanese plan to divide Manchuria and Korea into spheres of influence, Japan launched a surprise naval attack against Port Arthur, a Russian naval base in China. It was the first major battle of the 20th century, and the Russian fleet was decimated. During the subsequent war, Japan won a series of decisive victories over the Russians, who underestimated the military potential of its non-Western opponent. In January 1905, the strategic naval base of Port Arthur fell to Japanese naval and ground forces under Admiral Heihachiro Togo, and in March Russian troops were defeated at Shenyang, China, by Japanese Field Marshal Iwao Oyama.
Russian Czar Nicholas II hoped that the Russian Baltic fleet under Admiral Zinovy Rozhestvensky would be able to challenge Admiral Togo's supremacy at sea, but during the two-day Battle of Tsushima Strait, beginning on May 27, more than 30 Russian ships were sunk or captured by the superior Japanese warships. In August, the stunning string of Japanese victories convinced Russia to accept the peace treaty mediated by U.S. President Theodore Roosevelt at Portsmouth, New Hampshire. (Roosevelt was later awarded the Nobel Peace Prize for this achievement.) In the Treaty of Portsmouth, Russia recognized Japan as the dominant power in Korea and gave up Port Arthur, the southern half of Sakhalin Island, and the Liaotung Peninsula to Japan.
Japan emerged from the conflict as the first modern non-Western world power and set its sights on greater imperial expansion. However, for Russia, its military's disastrous performance in the war was one of the immediate causes of the Russian Revolution of 1905.