On the fifth day of the stand-off, Lysander sent ahead scouts, who signalled the main army once the Athenian crews had disembarked to take their meals. Thus almost the entire navy was caught unprepared and captured without resistance, and all the men taken were put to death. It was generally believed that some kind of treachery was involved, but Conon himself was never implicated. His ship was one of nine which escaped the disaster, boldly rushing to Lampsacus where the Spartans had left their sails (as was typical before a naval battle) and so preventing any effective means of pursuit. The Paralus returned to Athens, while Conon with the other eight ships fled to Evagoras of Cyprus, fearing the judgement of the Athenian commons.
As a result of this victory, Sparta defeated the Athenians and so attempted to carve out her own empire in the Aegean. Her relationship with Persia deteriorated, and she began raiding into the satrapies of Pharnabazus and Tissaphernes in modern Turkey. By 397 BC, Pharnabazus had persuaded the emperor Artaxerxes to prosecute the war by sea, and raised a fleet of 300 Phoenician and Cypriot ships. In sheer numbers they would be overwhelming, but they needed an experienced commander, and so they found Conon at Cyprus, who was only too happy for a chance to take revenge upon the Peloponnesians.
First Conon moved up to Caria with a small portion of the fleet, where he was for a time blockaded but then rescued by Pharnabazus and Tissaphernes. He then proceeded to Rhodes, where the pro-Spartan oligarchy was replaced by a democracy, and managed to capture food supplies being sent up from Egypt. At this the Spartans decided to send out their navy, but made the mistake of entrusting it to Pisander, who had no experience. The battle took place at Cnidus in 394 BC, and was an easy and overwhelming Persian success. The Aegean cities expelled the Spartan garrisons and accepted Persian rule.
After this Conon felt it safe to return to Athens. Pharnabazus allowed him to retain part of the fleet, and supplied money for the fortification of the Piraeus and the reconstruction of the long walls joining it to the city. So some of the main results of the Peloponnesian War had been undone - Athens regained her position as a major power in Greece, and though she had still lost her empire, Sparta had been prevented from taking it over.
The next year the Spartans had opened negotiations with the Persians, and in order to secure their position in Greece offered to abandon all the cities in Asia to them. The Athenians sent delegates to announce this as unacceptable, which Tiribazus took understood to mean that they still hoped to recover their empire, and outraged by this about-face threw them in prison, Conon among them. When Tiribazus was replaced by Struthus, a bitter enemy of the Spartan king, Conon was allowed to escape, and died soon afterwards at Cyprus. His son Timotheus later became another prominent general.