In 1941, the Dutch East Indies was a major producer of rubber, oil, quinine, coffee, tea, cacao, coconut, sugar, pepper, and tobacco. Of all these resources, oil mattered most. The United States had imposed an oil embargo on Japan in response to its aggression in China, and the Dutch East Indies fields, particularly those around Balikpapan and Tarakan on Borneo's eastern coast, offered a way to break that stranglehold. Japan's military planners viewed the conquest of the Dutch East Indies as essential to sustaining the war. Borneo was the gateway. To the north, the Philippines had already begun to fall, and Admiral Hart had moved Destroyer Division 57 to Balikpapan in November 1941, sensing that hostile action was imminent. When it came, it came fast. British Borneo and the Dutch East Indies fell to Japanese forces in 1942.

The Battle of Balikpapan on January 24, 1942, was a small engagement with outsized significance. Four destroyers from Destroyer Division 59, led by USS John D. Ford, charged into the harbor in a high-speed torpedo attack against the anchored Japanese invasion force. They sank four of twelve enemy transports, though many torpedoes malfunctioned, a persistent American problem early in the war. The engagement was brief and violent, and the four destroyers escaped into the darkness without a single loss. It was not enough to stop the invasion, but it was the first time American warships had fought a surface action in these waters in over four decades. For sailors reeling from Pearl Harbor and the fall of the Philippines, Balikpapan offered something rare in those early months: proof that the Japanese fleet was not invincible.

Japanese occupation brought suffering that the naval engagements only hinted at. At Sandakan, on Borneo's northeast coast, Australian and British prisoners of war captured at the fall of Singapore were forced to build a military airstrip. By late 1944, with Allied forces advancing, the Japanese ordered roughly 2,000 prisoners to march 260 kilometers through the jungle interior to Ranau. Weak, starving, and sick, the men staggered along muddy trails. Those who could not keep pace were killed. Those too weak to begin the march were left at Sandakan, where all eventually died or were murdered. Of the thousands imprisoned at Sandakan, only six Australians survived the war, all of them escapees who owed their lives to local Bornean people who hid and fed them at great personal risk. The Sandakan death marches remain the single worst atrocity suffered by Australian servicemen in the Second World War.

Liberation came in 1945 through a series of Australian-led amphibious operations. Tarakan was assaulted in May. Brunei Bay and Labuan followed in June. The campaign culminated at Balikpapan on July 1, 1945, the last major amphibious assault of World War II. Twenty days of aerial bombardment preceded the landings, hammering Japanese defenses along the oil-rich coast. Australian troops stormed ashore and fought through fortified positions to recapture the port and its refineries. The naval bases established during these operations stretched from Brunei to Balikpapan, from Morotai to Tarakan, a chain of advance bases that supported the final months of the Pacific War. After Japan's surrender, the bases were handed over to the newly independent nations that emerged from the wreckage of colonial empire. The oil that had drawn Japan to Borneo continued to flow, but the island's strategic purpose shifted. The naval bases closed, the jungle reclaimed the airstrips, and Borneo's war faded into a chapter that the island's forests slowly grew over.