After the fall of Fort Fisher on January 15, 1865 Gen. Braxton Bragg ordered all of the forts below New Inlet to be abandoned and their garrisons to report to Fort Anderson. Within a few days the garrison at Fort Anderson numbered around 1,100 North Carolina soldiers, a motley assortment of teenaged Junior Reserves, Coast Guard, and mostly artillery. In addition Brig. Gen. Johnson Hagood's Brigade of 989 South Carolina infantry was transferred to Fort Anderson to reinforce the garrison, along with 152 troopers from the 2nd South Carolina Cavalry. All told there were about 2,300 troops in Fort Anderson.
On January 24, 1865 the Federal monitor USS Montauk entered the Cape Fear River to begin operations against Fort Anderson. For the next week, a squadron of sixteen vessels was assembled to prepare for an assault on the fort. The first week and a half of February saw the Union squadron trading shots with Fort Anderson, while the Union army prepared their plan of action. Starting on February 14, soldiers from the Second and Third Divisions of the XXIII Army Corps, under the command of Maj. Gen. Jacob D. Cox, began crossing the river from Fort Fisher to Smithville (present day Southport). By February 17, when the advance toward Fort Anderson began, Cox's 6,000 man force consisted of the entire Third Division and one brigade from the Second Division.
As the Union naval squadron started bombarding the fort, Cox's men began their fourteen-mile advance. Cox had traveled less than three miles when his men ran into the 2nd South Carolina Cavalry, who were able to slow Cox's advance to a crawl due to the narrow road and swampy terrain. By the evening of the 17th, Cox's men had entrenched about a mile and a half south of Fort Anderson. The next morning, the Union advance on the fort continued, with Cox's men deployed in a three-brigade front with one in reserve. Within an hour, Federal skirmishers had begun to clash with the fort's skirmishers, and soon the engagement became general across the whole front. The Federals were able to advance to within six hundred yards of the defenses before superior Confederate artillery and horrendous terrain foiled further assaults.
It was obvious to Cox and XXIII Corps commander Maj. Gen. John Schofield that a frontal assault of Fort Anderson would be too costly, so they made alternate plans. The Confederates had cleared the ground in front of the fort for three hundred yards, creating a perfect killing ground. In addition they set a thick row of felled trees with branches sharpened and pointed toward the attackers. This defensive work, called an abatis, was designed to further hinder attacks. Federal commanders decided to split their forces and leave the brigades of Col. Thomas Henderson and Col. Orlando Moore in front of Fort Anderson's land approach, while Cox took the brigades of Col. John Casement and Col. Oscar Sterl on a flanking march around Orton Pond to gain the rear of Fort Anderson.
At 2:00 pm, Cox set off on his march with the brigades in front of the fort prepared to renew their assaults. Henderson and Moore engaged in heavy skirmishing against the fort's land face, while Cox forced his flanking troops around the head of Orton Pond. By 9:00 pm Casement's and Sterl's brigades had rounded the pond and encamped for the night. The Confederates defending Fort Anderson had endured the heavy skirmishing against the land face and more than 2,700 shells, ranging from 30-pounder Parrott rifle shells to huge 15-inch shells, fired from the Union naval squadron. Residents in Wilmington, fourteen miles away, could clearly hear the bombardment.
Also on the evening of February 18, Union Navy Lt. William Barker Cushing had constructed a mock ironclad monitor that was floated near Fort Anderson. It was hoped that the defenders would be fooled into detonating the rows of underwater torpedoes placed in the river channel just above the fort. There were various reports about the outcome, but it is widely believed that the Confederates were not fooled by the ruse.
Later that evening the news that reached Hagood was distressing: Federal soldiers had flanked the fort and would attack in the morning. Early on the morning of February 19 (between 2:00 am and 3:00 am), Hagood communicated to Maj. Gen. Robert F. Hoke, commander of the defenses of Wilmington, that he would have to abandon Fort Anderson or be surrounded by mid-morning. Hagood received permission to evacuate Fort Anderson and move his forces to a new line, about eight miles upriver at Town Creek. The Confederates quickly loaded as much as they could carry and hastily abandoned the fort. The evacuation was so quick that the large guns were not spiked and the magazines were not destroyed.
Henderson's and Moore's troops in front of Fort Anderson could hear sounds from within the fort and assumed that the Confederate were evacuating. At first light, the Federals stormed the fort and climbed over the walls against no opposition. Upon entering the fort, the Federals captured about fifty Confederates still inside. Unaware that the fort had been captured, the Federal gunboats in the river resumed their bombardment. After firing off several ranging shots at the fort, the squadron commander looked toward the fort and spotted Union troops atop the fort's walls frantically signaling for the ships to stop firing. Fort Anderson was now in Federal hands, and the fate of Wilmington was sealed.
Hagood's men made a brief stand at Town Creek, but were compelled to retreat to Wilmington after being flanked once again. On February 22, victorious Union troops march into Wilmington, and the last major port of the Confederacy was captured. Casualties at Fort Anderson were light when compared to the numbers engaged. Confederate casualties numbered about twelve while Union army and navy casualties numbered thirty-four.