The Chaco War, fought between Bolivia and Paraguay from 1932 to 1935, was primarily ignited by conflicting territorial claims over the Gran Chaco region, believed to be rich in oil resources. The region's harsh landscape and difficulties in navigation added to the complexity of the conflict, leading to extensive trench warfare and high casualties on both sides. The war resulted in a protracted struggle, as both nations sought control over this desolate yet strategically valuable territory. The fighting drew in large numbers of soldiers and resulted in significant suffering for the civilian population caught in the crossfire.

By June 1935, the situation had become untenable, and international pressure mounted for a resolution. As diplomatic efforts intensified, both nations agreed to enter negotiations for a ceasefire. The talks were marked by an atmosphere of urgency as the human and economic costs of the war had become increasingly apparent. The cessation of hostilities was a critical turning point that allowed both nations to begin the process of considering territorial disputes from a diplomatic perspective. The agreement, signed in early June, marked a definitive end to active operations, signaling a desire for peace and rebuilding.

The ceasefire laid the groundwork for future negotiations and ultimately led to the signing of the Treaty of Peace, Friendship, and Boundaries in 1938. These discussions would shape the political landscape of South America and redefine national borders. The end of the Chaco War also influenced military tactics and policies in the region, as both countries sought to reassess their military strategies in the face of modern warfare and international norms regarding conflict resolution.