Fort Dearborn was built in 1803 under Captain John Whistler on the south bank of the Chicago River, in what is now the Loop. The area was wilderness. Its commander, Captain Nathan Heald, described it as 'so remote from the civilized part of the world.' The fort was named for Henry Dearborn, then Secretary of War, and had been commissioned after the Northwest Indian War and the 1795 Treaty of Greenville. That treaty forced a coalition of Native American nations to cede vast territories, including land around the mouth of the Chicago River. The Potawatomi had not forgotten. The British Empire had ceded the Northwest Territory to the United States in the 1783 Treaty of Paris, but the land remained disputed. Tecumseh and his brother Tenskwatawa, the Shawnee prophet, built a confederation of tribes to resist American expansion. The British saw these nations as allies and a buffer for Canada, and armed them accordingly.

By the summer of 1812, the situation around Fort Dearborn had deteriorated badly. In April, Winnebago warriors murdered two men at a farm called Hardscrabble on the south branch of the Chicago River. Settlers fled into the fort or barricaded themselves in nearby houses. Captain Heald organized fifteen civilians into a militia. Then, on July 17, British forces captured Fort Mackinac near the northern tip of Lake Michigan, cutting off Fort Dearborn's supply line. General William Hull ordered Heald to evacuate. The order reached the fort on August 9. Captain William Wells, Heald's uncle by marriage, gathered about 30 Miami warriors and traveled from Fort Wayne to escort the evacuees. Potawatomi chief Black Partridge warned Heald on August 14 that the young warriors intended to attack and that he could no longer restrain them. Heald, fatefully, had already destroyed the fort's surplus arms, ammunition, and whiskey rather than distribute them to the Potawatomi as expected. The betrayal sealed the garrison's fate.

At 9:00 AM on August 15, the column marched out: 54 regulars, 12 militia, nine women, and 18 children, heading south toward Fort Wayne with the Miami escorts flanking. About a mile and a half from the fort, Potawatomi warriors rose from behind sand dunes and attacked. Heald ordered a charge up the dune, but the maneuver separated the cavalry from the wagon train carrying women, children, and provisions. The Potawatomi surged into the gap and surrounded both groups. The wagons fell first. Ensign George Ronan and the fort physician Van Voorhis died defending them. Captain Wells fought until he was brought down; according to eyewitness accounts, warriors cut out his heart and consumed it to absorb his courage. In fifteen minutes, it was over. Heald and the surviving soldiers retreated to a rise on the prairie and surrendered. The prisoners were taken to the Potawatomi camp near the fort, and Fort Dearborn was put to the torch.

The aftermath was bitter for everyone. Some prisoners died in captivity; others were ransomed. General William Henry Harrison, who was not present, falsely claimed the Miami escorts had fought against the Americans and used the battle as a pretext to attack Miami villages. The fort was rebuilt in 1816, and American settlement resumed. For the Potawatomi, the victory proved pyrrhic. The United States pursued a policy of Indian removal that culminated in the 1833 Treaty of Chicago, which forced the Potawatomi and other tribes to cede their remaining lands and move west. The treaty's conclusion in 1835 was marked by the last great Native American war dance in the young city. The accounts of the battle itself remain contested. Juliette Kinzie's 1856 book Wau-Bun provided the traditional narrative but is regarded as historically inaccurate, built on family stories rather than evidence. Whether one calls it a massacre or a battle depends on which story you tell, and who gets to tell it.

Chicago remembers Fort Dearborn in fragments. Dearborn Street, a major north-south artery and part of the original 1830 plat, carries the name. Heald Square honors Captain Nathan Heald. Ronan Park on the Far North Side commemorates Ensign George Ronan, the first West Point graduate to die in battle. In 1893, railroad magnate George Pullman commissioned sculptor Carl Rohl-Smith to create a monument depicting the rescue of Margaret Helm by Potawatomi chief Black Partridge, who helped her escape to Lake Michigan by boat. The monument was moved to the Chicago Historical Society in 1931, then removed in the 1970s after protests by Native American groups. It was reinstalled near 18th Street and Prairie Avenue in the 1990s, though efforts to move it again face resistance from the Chicago American Indian Center. The battle site itself lies beneath downtown Chicago, where millions walk daily over ground that was, for fifteen minutes in 1812, a killing field.