Cascade Falls was a large residential area where most of the American personnel at Fort Teller resided. It was home to several hundred people and possessed its own convenience stores and high schools. Three bridges lead into the heart of the town.
Four months after World War III broke out in Western Europe in 1989, the Soviet Union invaded the United States, resulting in the occupation of Seattle and the subsequent occupation of Washington State. After several weeks of fighting against the U.S. Army and Washington National Guard, the Soviets targeted Fort Teller in the Washington Rockies, intending to disable the offensive capabilities of the Strategic Defense Initiative. The SDI was a space-based defensive network intended to defend the U.S. in the event of a Soviet nuclear strike. However, the Soviets did not realize that the project had in fact been a failure, and that it operated only in name to discourage such an attack by the Soviets. If the Soviets discovered the ruse, the U.S. would be vulnerable to an imminent nuclear strike. The U.S. Army poured all of its available resources into defending Fort Teller.
Several U.S. battalions, led by Colonel Jeremiah Sawyer, delayed the Soviet assault into the Rocky Mountains by setting up a defense perimeter outside Cascade Falls while the American forces at Fort Teller fortified their position. At the same time, the civilian population at Cascade Falls was evacuated in the wake of the impending assault. After luring in the Soviet invaders, Sawyer had the entire force retreat to Cascade Falls, where they intended to trap and isolate the Soviets so that they could destroy their forces before they ever reached the fort.
The Battle of Cascade Falls began when American forces fortified their positions around the town in the hopes of luring in the Soviet invasion force. The battle resulted in massive infrastructural damage, as much of the town was subject to artillery strike and even carpet bombings, leveling most of the city. Although the Americans had successfully isolated the Soviets, word eventually came in that the Soviets were sending in several fresh battalions to squash the American defenders. With their forces in Cascade Falls and Fort Teller hopelessly overwhelmed, Colonel Sawyer ordered a tactical nuclear strike on Cascade Falls as a last resort. The Americans abandoned the town while Charlie Company, led by disgraced Captain Mark Bannon, stayed behind to stall the Soviets in order to prevent a premature retreat. Their diversion succeeded, as the nuclear strike killed most of the Soviets in the area, effectively saving Fort Teller.
However, the strike came at a high cost. Cascade Falls was totally annihilated in the blast, and the mountain range became subject to a nuclear fallout. Captain Bannon and his company were all killed in action, and the American survivors fell into disarray as they scattered across the countryside. The town's destruction also had a negative psychological impact on the Americans. The fact that they had to use a nuke on their own territory hurt American morale, and Colonel Sawyer became determined to prevent another such attack.