As early as the summer of 1943, the German high command began making plans for the eventuality that Finland might conclude a separate peace with the Soviet Union. The Germans planned to withdraw forces northward in order to shield the nickel mines near Petsamo. During the winter of 1943 to 1944, the Germans improved the roads from northern Norway to northern Finland, and they accumulated stores in that region. Thus the Germans were ready in September 1944, when Finland made peace with the Soviet Union. While German ground troops withdrew northward, the German navy mined the seaward approaches to Finland and attempted to seize Suursaari Island in the Gulf of Finland. Fighting broke out between German and Finnish forces even before the Soviet-Finnish preliminary peace treaty was signed, and the fighting intensified thereafter, as the Finns sought to comply with the Soviet demand that all German troops be expelled from Finland. The Finns were thus placed in a situation similar to that of the Italians and of the Romanians, who, after surrendering to the Allies, had to fight to free their lands of German forces. The Finns' task was complicated by the Soviet stipulation that the Finnish armed forces be reduced drastically, even during the campaign against the Germans.

The capable Finnish general, Hjalmar Siilasvuo, the victor of Suomussalmi, led operations against the Germans in October and November 1944, he drove them out of most of northern Finland. The German forces under General Lothar Rendulic took their revenge, however, by devastating large stretches of northern Finland. More than one-third of the dwellings in that area were destroyed, and the provincial capital of Rovaniemi was burned down. In addition to the property losses, estimated as equivalent to about US$300 million (in 1945 dollars), suffered in northern Finland, about 100,000 inhabitants became refugees, a situation that added to the problems of postwar reconstruction. (After the war the Allies convicted Rendulic of war crimes, and they sentenced him to twenty years in prison.) The last German troops were expelled in April 1945. As a final, lingering effect of the Lapland War, the Germans planted numerous mines during their retreat some of the mines were so cleverly placed that they continued to kill and maim civilians who triggered them as late as 1948.

Data as of December 1988