If the years between the Peloponnesian and Corinthian wars were the high point of Spartan power, they were also the years in which the Laconian city-state systematically engineered its own fall from power. These years saw Sparta abandon any pretense of diplomacy, instead executing its will by dictate backed by its own martial power. This policy extended not only to the parts of Greece that had combined against it during the Peloponnesian War, but also those that had allied themselves to it, and even to members of its own Peloponnesian League. A prominent example of this was a 402 BCE direct attack on the city-state of Elis, which, along with Corinth, had been one of the first additions to the league.
The frustration with Sparta was made worse by the influence of the Persian empire which, though it had loosely allied itself with Sparta during the Peloponnesian War, was far from a firm ally. In 396 BCE, the year before the Corinthian War would actually begin, the Persian empire would send representatives to Greece to provide funding to city-states that it believed might be led into a revolution against Spartan dominance. The empire was now under the control of Artaxerxes II, and the preliminary funds almost certainly acted as a tacit message that Persian support would be given to the city-states that would engage in a war with Sparta. Thus, Corinth and Thebes, two of the major city-states that were then part of Sparta's alliance, were turned in the direction of a general war with Sparta. Argos, too, was prepared for the conflict, as its perennial enmity with Sparta had not cooled in the years since the Peloponnesian War.
The first major city-state to begin an effort against Sparta was Thebes, which formed an alliance with the weakened Athens in 395 BCE after starting a minor war between the Phocians, who were staunch allies of Sparta, and the Locrians into which Sparta would certainly be pulled, thus solidifying relations between Attica and Boeotia. Sparta was now under the dual kingship of Pausanias of the Agiad house and Agesilaus II of the Eurypontid house, with Lysander still the most prominent general of the Spartan military. The Spartans decided on a strategy of sending two armies, one under Lysander and one under Pausanias, to attack Boeotia and support the Phocians in their efforts.
The opening campaign of the war, however, would result in a disaster for Sparta. The armies of Lysander and Pausanias were to meet at the city of Haliartus on a specified day in order to coordinate their further operations in Boeotia. However, Lysander arrived one day earlier than scheduled and before Pausanias. Theban forces attacked Lysander's army, which was defeated. In the fighting, Lysander himself, arguably the most prominent military commander Sparta had produced since Leonidas had made his legendary last stand at Thermopylae, was killed. Pausanias would not arrive until it was far too late, and would strike an agreement with the Thebans to allow his army to collect the bodies of the fallen Spartans for burial in exchange for the return of his own army to Sparta. Upon his return, Pausanias would be placed on trial for his withdrawal back to Sparta, though he would flee Sparta before the sentence of death placed upon him could be carried out.
The Battle of Haliartus was the true beginning of the Corinthian War that would soon engulf much of Greece. Corinth and Argos next formally joined the alliance that had been formed between Thebes and Athens, putting enemy states much closer to home for the Spartans. Agesilaus II, who had been engaged in a series of wars in Persian-controlled Asia, was officially called back to Sparta to lead the attack on its enemies. His return would be slow, as he had to cross much enemy territory in order to make it back. Later in 394, his returning army, aided by what few allied forces could be mustered, would fight a battle at Coronea in Boeotia which would ultimately result in a mild Spartan victory. During the same time period, Persia would lend its fleet to the efforts against Sparta, resulting in the capture of much of the Spartan navy at the Battle of Cnidus. This same fleet would go on to reinforce Athens in 393 BCE, bringing both additional funding and labor for rebuilding the defensive works that had kept Athens safe during the Peloponnesian War.
The next year of the war would be a continued period of confusion in the power structure of Greece. While Sparta would retain much of its dominance as a land force, the loss of much of its navy had cost it the command of the seas that it had briefly enjoyed. A major Spartan victory would occur in the taking of the port city of Lachaeum, an important subsidiary city to Corinth, which was itself now split into two factions, one for and one against Sparta. Athens, which had been in a greatly weakened state since the end of the Peloponnesian War, was now also making a swift comeback with the help of the Persian admiral Conon, who had consistently allied his forces to Athens against Sparta in retaliation for the campaigns of Agesilaus II against Persia.
Because of this, Sparta would seek to gain Persia as an ally in 392 BCE, playing on the long-standing hatred of the Persian kings for Athens that stretched back as far as Darius I. This attempt would result in at least some gain for Sparta, as Conon was arrested by Tiribazus, the primary military commander of Persian forces in Asia Minor, who also provided Sparta with sufficient funding to construct a new fleet of ships. Tiribazus, however, would be replaced in command by another commander, Struthas, who would continue on with Conon's anti-Spartan stance on behalf of the Persian empire.
By 391 BCE, the factions in Corinth had broken down completely, resulting in the control of the city itself by the separatists and the establishment of a pro-Spartan opposition government at Lechaeum. Agesilaus would campaign in and around Corinth in an attempt to support this opposition government, but would ultimately be driven out of Corinthian territory by the Athenian general Iphicrates, who had adopted a tactic of launching swift, short attacks with medium-light infantry against the Spartan phalanx formation that had proven incredibly effective against the historically unshakable close-rank formation in the field. Corinth would return almost entirely to the control of the Athenian-allied separatists, and Sparta would be disgraced by one of the few times it had ever been defeated in a series of general infantry engagements.
The following two years of the war would see Sparta and Athens duel over territory time and again, with Sparta suffering many desertions from the ranks of its alliances. Continued tension with Persia, which at this time was still pursuing an anti-Spartan military policy by supporting Athens and its allies, would put Sparta at war with both Athens and the Persian empire at the same time. Though its territorial influence was waning, Sparta itself was in no danger. It's well-defended natural position combined with a land army that was still far too powerful to attack head on in its own territory made a conquest of Sparta completely unthinkable for the allies. Nevertheless, the blows to Sparta's power were severe. Not only was it losing influence rapidly, it was also failing to retake territory that had once been firmly under its control.
One prominent example of this latter circumstance is a 388 BCE campaign in Argos, which had combined with Corinth and Thebes against Sparta at the outset of the war hoping to at last throw off the oppression of its ancient enemy. Although a Spartan force was able to enter Argive territory nearly unopposed, it failed to establish a new territorial dominion in Argos. However, the Spartans were turning the tide in their own favor in other arenas.
Sparta's new naval force, once deployed, was able to launch raids against the coast of Attica and block the passage of transport ships to Athens, largely cutting off its food supplies. Around the same time, Artaxerxes began to grow concerned with the resurgence of Athenian power in Greece, just as Sparta had hoped he would much earlier in the war. In an unusual move, the Persian emperor imposed a peace on Greece at the behest of Sparta, even though his empire held no sway over the warring Greek city-states that were involved in the Corinthian War. The terms of the Persian-imposed peace agreement were that most city-states would return to full autonomy, with Sparta's claims in Asia ceded to Persia and a handful of traditionally Athenian-allied states returning to the control of the revived Athens. Tired of the war and with the threat of a third Persian invasion against either side that did not obey this command from Artaxerxes, the Greeks ended the Corinthian War in accordance with these terms.
On the surface, the Spartans had won the war and secured their position as the preeminent city-state of the Greek world. The political reality, however, was less black and white. Though Sparta was able to bring the war to a halt, it had not been able to do so independently, instead relying on the intervention of the Persian empire. It had also been shown that Sparta, though now briefly secured as the greatest power, could in fact be beaten in combat. Thebes, in particular, would remember this lesson and put it to good use in its future efforts against Sparta. The Corinthian War had also produced a revived Athens, no longer the vastly weakened city-state that had been left at the whims of Sparta at the end of the great war between the two. Though Sparta would remain as a great power in Greece, the era after the Corinthian War would see these problems bring an end to the Spartan dominance over Greece.