Maroubra Force withdrew to the next defensible strong point on the Track, a feature known as Mission Ridge. Following the containment of the Japanese at Milne Bay, Allen finally released the 2/27th Infantry Battalion from the divisional reserve at Port Moresby. After advancing along the Track from Port Moresby, the 2/27th Infantry Battalion finally joined Maroubra Force at Mission Ridge and Brigadier Potts was finally able to commit his entire brigade to the battle.

Taking up positions on a hilltop straddling the Track, which later became known as “Brigade Hill”, Maroubra Force awaited the Japanese advance. The usual Japanese frontal attacks began soon after upon the Australian leading elements. However, the Japanese launched a strong flank attack, aimed at cutting off the lead elements from the rest of Maroubra Force. The flank attack cut Maroubra Force in two, separating the brigade headquarters staff from the three battalions. With Brigade HQ about to be overrun, Brigadier Potts and the rear elements of Maroubra Force were forced to retreat back along the Track to the village of Menari .

When it became clear that they were in danger of being cut-off and destroyed, the remaining soldiers of all three Australian battalions immediately left the Track and “went bush” via an alternate track to the village of Menari . The 2/14th and 2/16th Infantry Battalions managed to re-unite with Brigadier Potts and 21st Brigade headquarters at Menari but the 2/27th Battalion was unable to reach Menari before the rest of the brigade was again forced to retreat by the advancing Japanese.

The 2/27th, along with wounded from the other battalions, were forced to follow paths parallel to the main Track, eventually making their way back to Ioribaiwa, and thence to Imita Ridge. Elements of the 2/14th and 2/16th Infantry Battalions accompanying Potts later managed to regroup for the defence of Imita Ridge, but the 2/27th only managed to regroup much later, after the Japanese retreat began. The result of this action was the shattering of Maroubra Force.

The defeat of the 21st Brigade at Brigade Hill finally ended Maroubra Force’s defence of the Kokoda Track as a cohesive unit and was a decisive victory for the Japanese. The defeat was one of many factors leading later to the “rabbit that run” incident at base camp at Koitaki.

On 8 September, Rowell informed Blamey that he had decided to relieve Potts. Rowell ordered Potts to immediately report to Port Moresby “for consultations”, replacing him as Maroubra Force commander with Brigadier Selwyn Porter on 10 September.

The series of defeats had a depressing effect back in Australia. On 30 August , MacArthur radioed Washington that unless action was taken, New Guinea Force would be overwhelmed. General George Vasey wrote that “GHQ is like a bloody barometer in a cyclone, up and down every two minutes”. MacArthur informed General George Marshall that “the Australians have proven themselves unable to match the enemy in jungle fighting. Aggressive leadership is lacking.” He wanted Blamey to go up to New Guinea and “energise” the situation.

Prime Minister John Curtin ordered Blamey up to Port Moresby to take personal command of New Guinea Force, which he did on 23 September. Rowell remained in command of I Corps, but saw this as a suppression. Blamey soon concluded that he could not work with Rowell and relieved him of his command on 28 September replacing him with Lieutenant General Edmund Herring.