Following the surrender of Lieutenant-General Lord Cornwallis army at Yorktown in October 1781 American independence was all but granted by the debt-ridden British, who now took steps to assume an ascendancy over the French before peace could be negotiated. To achieve both ends it was with a relief to the country that Lord Frederick North s government resigned on 20 March in favour of a Whig administration, with firstly the Marquis of Rockingham becoming prime minister, and then on his death in July, the Earl of Shelburne. At the Admiralty Admiral Hon. Augustus Keppel replaced the unpopular Lord Sandwich, whilst a number of leading naval officers who had refused to serve the previous government came out of their temporary retirement to take up senior commands. On 30 November preliminary articles of peace were signed, but it would be another couple of months before hostilities ceased.

The arrival of Admiral Keppel at the Admiralty saw a marked change in British naval policy, as well as the return to duty of many high profile officers following the change of government.

Earlier in February Admiral Sir George Rodney had re-assumed the command of the Leeward Islands fleet from Rear-Admiral Sir Samuel Hood, who on 25/26 January had outwitted the French West Indian fleet under the command of the Comte de Grass at the Battle of St. Kitts, although he was unable to save that island from capture. On 12 April Rodney was able to bring the French to the conclusive Battle of the Saintes where he earned a victory which enabled peace to be made with honour. Sadly a number of the French prizes and their British captors were lost lost after the Central Atlantic Hurricane struck the homeward-bound convoy on 16 September. In addition to St. Kitts Britain also lost the West Indian territories of the recently captured Dutch Guyana, as well as Nevis, Demerara and Essequibo to the French, and the Bahamas to a Franco / American force in May.

In European waters Minorca surrendered to a joint Spanish/French force in February after a long defence, but when Admiral Lord Howe took command of the Channel fleet after the fall of the despised government he quickly blew away the preceding years of timidity by engaging in an active campaign from April to August. This saw the capture of a French East India convoy by Vice-Admiral Hon. Samuel Barrington on 20 April, with Captain John Jervis being conspicuous in the action, and the blockade of the Dutch who were attempting to put a fleet into the North Sea. Howe and the new first lord of the Admiralty, Keppel, managed to achieve these successes with the rapid yet sensible deployment of the small fleet. After sailing to join Rear-Admiral Richard Kempenfelt in the blockade of Brest the whole fleet was forced by sickness to return to Spithead, but in July it put to sea again to bring in the Jamaican convoy. At the time the Comte de Guichen was at sea with a combined Franco / Spanish fleet of forty ships but once again the allies achieved nothing before their retirement to Brest. In the late summer the Spanish withdrew their ships to Algeciras and began a massive bombardment of Gibraltar that reached its zenith with the Grand Assault on 13 September, on which occasion the naval force under Captain Roger Curtis greatly distinguished itself. Howe, with thirty-four sail of the line eventually relieved the Rock in October, and there followed a partial engagement with the allied fleet off Cape Spartel which despite the loss of over one hundred lives was hardly worthy of the label Battle applied to it. The Channel fleet s successful campaign was tinged with tragedy when the mighty Royal George sank off Spithead with huge loss of life on 29 August, taking the brilliant Kempenfelt with her..

The East Indies station saw a great deal of activity, precipitated in January by Vice-Admiral Sir Edward Hughes capture of Trincomale on the island of Ceylon. His opponent, the brilliant French Commodore Pierre Andr de Suffren, had assumed the role of commander-in-chief on the death of Rear-Admiral Comte Thomas d Orves, and he refuted the need for any base by the expedient method of refitting his ships through the capture of British merchantmen. At the Battle of Sadras on 17 February, Providien on 12 April, Negapatam on 6 July, and Trincomale on 3 September, the two fleets fought a series of bloody, yet inconclusive engagements. Hughes was reinforced by Commodore Sir Richard Bickerton in October with five sail of the line, but the French suffered reverses when Kempenfelt in December 1781, and then Barrington in April 1782, captured their own reinforcements.

In minor actions Captain Charles Morice Pole of the Success brilliantly captured a Spanish frigate on 16 March but was unable to keep her as a prize. Captain Henry Trollope of the experimental Rainbow proved his vessel s worth with an easy victory over the French frigate H b on 4 September, and two French frigates were chased into the Delaware on 14 September by a squadron under the command of Captain Hon. George Keith Elphinstone, with one of them being captured. On 17 October the French ship of the line Scipion was lost off San Domingo following a controversial and inconclusive engagement with the London 90 which resulted in Captain James Kempthorne requesting a court-martial upon himself. The frigate Blonde was wrecked on 10 May, but given Captain Edward Thornbrough s previous kindness to his American prisoners her crew were landed on Nova Scotia by two enemy privateers, whereupon Thornbrough and some of his crew were rescued by the brig Observer and promptly involved in a ferocious action with another American privateer. A far less favourable outcome awaited Captain George Talbot and the crew and passengers of the East Indiaman Grosvenor when she was wrecked on the hostile south-east African shore on 4 August.