There was a short stint of peace in Hypeltheon, the Elves, with the aid of the Dwarves, built the Western Wall, and Tharkas began to recouperate and rebuild their army. However, just across the Easulan River that stretches from North to South in the middle of the continent, was the Tharkas Colony, stockpiling weapons, troops, armor, horses, and the like. They were preparing for war against Tharkas. The colony had become very powerful in the more recent years, they began forging weapons and armor to aid Tharkas against the Elves, but most of it was never used, so they kept it.

Three years after Tharkas' war with the Elves, signs of a new war began to brew. The colonial supply trains stopped coming from their colony, and the trains that left for the colony never returned. There were rumors of armored men patrolling the river on the Eastern shores, and of battle-camps in the plains between the river and the colony.

Finally, a year after, the newly formed Colonial Army dealt its first blow, they drove in the middle of the night, straight for the heart of Tharkas. What they failed to realize was that the castle and town had been completed. Tharkas Castle was a nearly impregnible fortress. The castle stood several hundred feet, and before it were 4 walls, armed to the teeth with their new army - The White Cloud Army of Tharkas. They wore shimmering Armor of blue and silver, and their Commanders wore capes of blue with a gold insignia sewn in upon the center. Only half the posts were manned this night, like every night. The colonial army sent up one man to beseech entrance to the city. Unfortunately for Tharkas, he was permitted, and when the gates opened, the whole army surged forth from the darkness and broke into Tharkas City. They began burning houses and slaughtering villagers and Knights alike. The gates for the Innermost wall, Inner wall, and the Second wall all began to close. The second gate was halted by pillars of wood, and the colonial army pushed forward into the second part of the city, setting it ablaze like the first. The Knights on the walls shot down and fought viciously to protect their city, and the Colonials never managed to reach the castle. By the end of it, there was a thick cloud of death hanging over the Capital City of Tharkas, and the sun began to peek over, looking down upon Tharkas' new enemy.

A new project was put into effect at that point. The King of Tharkas wanted a fortress that none could pass, and none could burn. He commanded the best architechs, ironworkers, and stoneworkers to begin building this fortress in the North, where the colonial army came from. He wanted that to never happen again.

Before construction began, the colonial army moved back into Tharkas' territory and marched for Bylet, a little town Northeast of Tharkas City. When they got there, they were met by four regiments of the White Cloud Army of Tharkas. This was to be the first battle of the second war. The colonials were slaughtered by the White Cloud, who had been trained with new tactics to help them beat the Elves, and rearmed with better armor and weapons.

The whole of the White Cloud Army of Tharkas was moved up to the site of the new fortress, it had finally been completed in the planning stages, and they were to begin building soon. It was to be called the Iron Crag - a massive fortress that holds 10,000 men, and can withstand a seige from an army of twice the size. The walls and heart of the fortress were to be built of Iron, and have a new device that had just been created, the cannon. It is the only projectile weapon of its kind. Firing massive iron balls at great speeds. While the Iron Crag was being built, the White Cloud moved forward and invaded their colony. The colonial army, being crushed twice, was beginning to dwindle. They couldn't hold back the White Cloud at a few of their smaller outskirt towns, and made their final stand at their new capital-to-be: Unluthio.

Battle for Unluthio: This was the first show of the White Cloud's true might. Catapults were moved up from the rearguard and they began hurling large boulders at the city walls. White Cloud were attempting to barrage the gate from the front, while Archers stood at the hind and fired up at the soliders upon the walls. Unluthio was unable to defend itself. It's archers were few and far between, and they couldn't open the gate or the White Cloud would surge forth and take the city. So they sat tight for two days of constant seiging until finally the gate began to snap. The catapults were moved back and the Army left an aisle in their ranks. When the final boulder flew from the distanced catapult, the giant rock hit their gate, crushing it, and the boulder. From there the colonial army pushed out of their city and began to fight, but they didn't expect the White Cloud to be on both sides of them, they were flanked and slowly slaughtered. The White Cloud moved up into the city and started to destroy it from the inside, leaving the colonials hard pressed to stop them. After about an hour, they stopped. A messenger had come from Tharkas and ordered all White Cloud to retreat.

The Iron Crag was finished, and fully manned with 10,000 Knights. The colony was left to fend for itself, and rebuild. The King had seen enough destruction and declared them a new nation on the other side of the Easulan River, Unluthio Kingdom was formed.