The village of Isurava was the site of one of several desperate battles fought by Australian troops during their retreat along the Kokoda Trail. Their position at Deniki becoming untenable, the 39th Battalion, then the only Australian unit confronting the Japanese on withdrew to Isurava on the night of 14 August 1942. Poorly equipped, the battalion had to dig-in with bayonets, bully beef tins and helmets. The 39th was fortunate that the Japanese did not immediately follow-up their success at Deniki and a lull in the fighting ensued for almost a fortnight, allowing reinforcements from the 21st Brigade to begin moving forward.
On 26 August the Japanese clashed with the 39th's forward outposts at Isurava heralding that their next attack was developing. The same day the first two companies of the 2/14th Battalion arrived to relieve the 39th's exhausted young soldiers, the average age of whom was 18. The next afternoon the 39th's left flank was heavily attacked and, fow while the Japanese were able to penetrate one of the company positions but they were beaten off by two quick counter-attacks. Fighting swirled all around the forward arc of the position throughout 28 August as the Japanese sought a weakness ion the Australian defences to exploit. The rest of the 2/14th Battalion arrived this day and its commanding officer, Lieutenant Colonel Albert Key assumed command of the area. Although the 39th now had the chance to withdraw for a well-earned rest, its commander, Lieutenant Colonel Ralph Honner, aware of the onslaught the 2/14th would face, decided it would remain in place. The men of the 39th, however, were moved into positions to the rear to allow the 2/14th to occupy the most threatened parts of the positions.
The morning of 29 August brought ferocious attacks right around the forward arc of the position. The first company to give way was C Company of the 2/14th and the Japanese poured through the gap, threatening the whole position. A counter-attack met them head-on, Private Bruce Kingsbury was to the fore, rushing forward and sweeping the Japanese with his Bren gun. A sniper's bullet killed Kingsbury, who was subsequently awarded a posthumous Victoria Cross for his actions, but the counter-attack had momentarily restored the situation. The Japanese continue to press home their attack throughout the afternoon. C Company was forced to give ground, and D Company, astride the trail, broke around 3pm, having repulsed 11 previous attacks on its positions. As night closed in the position at Isurava was in danger of being overwhelmed and a withdrawl of just over a kilometre to positions around the Isurava Guest House was conducted.
The Japanese followed close on the heels of the Australians and 30 August brought no respite. With some of the companies under his command now struggling to muster a full platoon, Key lacked the troops to cover the high ground to his left - a weakness the Japanese quickly exploited. They heavily attacked the Australians' right rear threatening to cut the track behind them. A further withdrawal was ordered at 3pm but many had to fight their way out, including Key's command group. When the 2/14th mustered at Alola the next morning 172 personnel were missing in addition to those known to be dead and wounded.
At Isurava the Australians had been overwhelmed by superior numbers which, poorly equipped and supported, they could never match. Although the 2/14th Battalion was experienced and relatively fresh, its potential to wrest the initiative from the Japanese was undermined by the torturous march along the Kokoda Trail which meant that it could only be employed in the piecemeal fashion in which it arrived at Isurava. The delay imposed there, however, did allow time for the other battalions of the 21st Brigade to make their way forward.