In the several days between the end of second Kokoda and the beginning of the Japanese attack on Deniki the Maroubra Force commander, Major Cameron, reorganised his force. He brought up from reserve a fresh company of 39th Battalion so as to give a rest to the two companies which had borne the brunt of the earlier fighting. Sickness began to deplete the force, reducing Cameron's effectives to about 470 men.

Tsukamoto, the Japanese commander, was on his way to attack Deniki when Cameron's retaking of Kokoda upset his plans. The importance of Deniki was that it overlooked Kokoda, six kilometres to the north, it was at the junction of other tracks leading north-east towards Oivi, and it guarded the entrance to Eora Gorge along which the Kokoda track went south towards Isurava. Now a week later, with Kokoda back in Japanese hands, Tsukamoto was able to go ahead with the planned attack on Deniki. He had 450 men, his own battalion together with its single artillery piece.

On 13 August, the lull which had prevailed at Deniki broke as all the signs of the previous day had foreshadowed. Major Cameron reported to Moresby that he was expecting attack and that 1000 to 2000 Japanese were massing in the valley below us.

The 39th Battalion War Diary for 13 August notes:

The enemy attack at Deniki commenced at 0950 hrs when rifle and MG fire started all along our front and from all flanks. This was considered to be preliminary endeavor to ascertain our positions by drawing fire in return, before concentrating upon any special point for the main attack. Our troops held their fire well, reserving it for definite visible targets.

Arrangements were made for aerial support and NGF was advised of location targets. This support however did not eventuate.

The first clashes in the battle for Deniki are summarized by Dudley McCarthy in South-West Pacific Area-First Year:

Bidstrup's company was in the right forward position, Jacob in the centre front with C Company, and Merritt on the left. The main force of the attack fell on Merritt with lighter attacks on Jacob. Merritt lost nine of his men in the first hour and said later of the Japanese: 'They came up the hill, four or five abreast, in shorts and helmets Lieutenant Simonson's platoon beat them back with grenades and tommy-guns'. During a lull at midday, Simonson heard mess tins rattling; he crept forward, saw Japanese sitting about eating, and knocked out two machine guns and a number of men with grenades. All day the attackers probed and drove at the front. Night followed behind drifting rain and midst, wet and swirling darkness which was broken by bursts of fire until 1am.

Don Simonson was awarded the Military Cross for the beforementioned action.

In the first day's fighting at Deniki 20 Platoon alone suffered ten causalities: Lance-Corporal Hackett (killed); Private Nottle (died of wounds); Sergeant Kempton, Privates Burnmiester, Cole Downey, Read, Timms and Winther (wounded); and Private Lanigan (missing), and five of those casualties were sustained in the first five minutes of the initial attack.

On the morning of the 14th of August the Australians withdrew from the Deniki position and fell back towards Isurava. The withdrawal was well timed as soon after the force departed the position the Japanese assaulted in force once again and found Deniki had been abandoned.