Initially the war against Germany and Italy went very well for Greece. The nation rallied behind Metaxas, and men of all political persuasions joined the military. Under the leadership of General Georgios Tsolakoglou, the Greek army in Epirus drove the Italians out of Greece and through most of Albania by early December. For many Greeks, this campaign was an opportunity to liberate their countrymen across the Albanian border in "Northern Epirus." The campaign stalled in cold weather, then it lost its leader, Metaxas, who died in January 1941. The British, who at this time had no other active ally in the region, provided air and ground support. But poor coordination between the allied forces made Greece vulnerable to a massive German attack in the spring of 1941, which was intended to secure the Nazi southern flank in preparation for the invasion of Russia. Under the German blitzkrieg, the Greek and British forces quickly fell. Most of the British force escaped, but Tsolakoglou, trapped between the Italian and the German armies, was forced to capitulate. Athens fell shortly afterward as the second element of the German invasion force rushed southward. King George II, his government, and the remnants of the Greek army fled to Crete. Crete fell the next month, however, and George established a government-in-exile in Egypt.

By June 1941, Greece had been divided among Bulgaria, Germany, and Italy. The Germans controlled all the most critical points: Athens, Thessaloniki, Crete, the Thracian border zone with Turkey, and a number of the Aegean Islands. The Bulgarians were given Thrace and most of Macedonia, which they proceeded to rule with an iron hand. The Italians occupied the rest of Greece. From the outset, however, the Germans effectively controlled the country, ruling harshly through the collaborationist governments of Tsolakoglou and later Ioannis Rallis. The German plundering of the nation's resources for the war effort combined with a British naval blockade to cause food shortages, massive inflation, and finally a devastating famine that killed as many as 100,000 people in the winter of 1941-42.