On 20 February 2025, the Arakan Army started an offensive to capture Kyaukphyu District. Clashes first started near the Danyawaddy Naval base.
Kyaukphyu District in Rakhine State is home to the Kyaukphyu Special Economic Zone. A key asset of the SEZ is the Kyaukphyu Deep-Sea Port, which is part of China's Belt and Road Initiative.
After the 2024 Battle of Ann, the Myanmar junta only controlled Sittwe, Kyaukphyu, and the island of Cheduba in Rakhine State. AA intends to capture all of Rakhine to "restore the sovereignty of the Arakan people."
On 20 February 2025, the Arakan Army and the Tatmadaw began clashes near Danyawaddy naval base. AA also attacked the No. 32 Police Battalion headquarters.
On 26 May 2025, Brigadier General Kyaw Myo Aung, a commander of the Tatmadaw's 11th Infantry Division, was killed by an AA sniper. Lieutenant Colonel Kyaw Lin Kyaing was also captured on 30 May 2025.
The Myanmar junta announced a ceasefire from 1 June to 30 June. Despite this, Tatmadaw forces reportedly bombed AA positions during the ceasefire period.
The junta claimed on 10 November 2025 that the village of Thaing Chaung and its dam were captured from AA.
On 14 November 2025, a group of Tatmadaw soldiers were killed by artillery from the Arakan Army shortly after a photo session at the briefly-occupied Kyaukphyu Meteorological Radar Station in . Approximately 10 Tatmadaw soldiers were killed and more than 20 were injured, with Major Ko Ko Zaw being reportedly among the fatalities.
On 18 February 2025, the SAC junta passed a law to allow foreign companies to station armed private security on company property in Myanmar. As China possesses significant investment of the Kyaukphyu SEZ, Chinese private security companies composed of former PLA soldiers and Burmese nationals were stationed near its properties. Since then, AA claimed that the Tatmadaw was being assisted by drone operators employed by Chinese security companies operating in Kyaukphyu.