To Cornwallis, this force was a threat to the left flank of his planned advance into North Carolina and he sent a force commanded by Tarleton to catch it. The British force of 1,100 was composed of Tarleton's own British Legion, supported by regular infantry.
Tarleton's plan, such as it was, was quite simple. His men were to catch Morgan and immediately attack, expecting the militia to break, leaving the Continentals outnumbered. However, Morgan anticipated this, and deployed his men well. On 17 February 1781 he formed up in three lines at Hannah's Cowpens. First was a skirmishing line of about 150 sharpshooters. Next came the Carolina militia, whose orders were to fire two volleys and then withdraw behind the third line, of Continental Infantry and the Virginia Militia, placed on top of a hill. Once the British were engaged against this third line, the South Carolina militia on one flank and the Continental Cavalry on the other were to outflank them.
Tarleton fell into the trap. On arrival at Hannah's Cowpens, he barely paused for long enough to form up his men before ordering the charge. The American plan worked as expected. The riflemen and militia inflicted heavy casualties on the British, and then pulled back behind the line. The British were further surprised when the third line of American regulars did not retreat, as they had so often done in the past, but instead held their ground and fired on the advancing British. Tarleton was forced to call on his reserve, a battalion from the 71st Highland regiment. The Highlands threatened to outflank the main American line, and the commander of the American line ordered the militia unit at the right of the line to wheel to face the new attack. This was too much for them, and they started to move back, soon followed by the rest of the line. The British were convinced that the Americans were about the break, and their own formations started to lose their integrity as they moved to chase what they thought was a broken enemy.
However, the American movement was not a retreat, and Morgan was able to form them up behind the hill. The British in pursuit crested the hill to find not a retreating rabble, but an intact force that now turned and fired on the British. The units exposed to this fire broke almost instantly. Washington's cavalry and the militia now attacked the rest of the British force. The battle was lost within minutes. Tarleton managed to escape with forty cavalry, but the majority of his men surrendered.
At a cost of 12 dead and 60 wounded, Morgan had largely destroyed Tarleton's force. With 525 prisoners, 100 dead and 229 wounded (also captured), Tarleton had suffered losses of over 75%. The reputation of Tarleton's Legion was permanently lost, and the British losses were hard to replace, weakening Cornwallis in the campaign that was to lead to Guilford Courthouse.