The Eighth Army now enjoyed a massive superiority in material over the Axis forces: 1st Armoured Division had 173 tanks and more in reserve or in transit, including 61 Grants while Rommel possessed only 38 German tanks and 51 Italian tanks although his armoured units had some 100 tanks awaiting repair.

Auchinleck's plan was for Indian Infantry 161st Brigade to attack along Ruweisat ridge to take Deir el Shein, while the New Zealand 6th Brigade attacked from south of the ridge to the El Mreir depression.
At daylight, two British armoured brigades—2nd Armoured Brigade and the fresh 23rd Armoured Brigade—would sweep through the gap created by the infantry.
The plan was complicated and ambitious.

The infantry night attack began at 16:30 on 21 July.
The New Zealand attack took their objectives in the El Mreir depression but, once again, many vehicles failed to arrive and they were short of support arms in an exposed position.
At daybreak on 22 July, the British armoured brigades again failed to advance.
At daybreak on 22 July, Nehring's 5th and 8th Panzer Regiments responded with a rapid counter-attack which quickly overran the New Zealand infantry in the open, inflicting more than 900 casualties on the New Zealanders.
2nd Armoured Brigade sent forward two regiments to help but they were halted by mines and anti-tank fire.

The attack by Indian 161st Brigade had mixed fortunes.
On the left, the initial attempt to clear the western end of Ruweisat failed but at 08:00 a renewed attack by the reserve battalion succeeded.
On the right, the attacking battalion broke into the Deir el Shein position but was driven back in hand-to-hand fighting.

Compounding the disaster at El Mreir, at 08:00 the commander of 23rd Armoured Brigade ordered his brigade forward, intent on following his orders to the letter.
Major-General Gatehouse—commanding 1st Armoured Division—had been unconvinced that a path had been adequately cleared in the minefields and had suggested the advance be cancelled.
However, XIII Corps commander—Lieutenant-General William Gott—rejected this and ordered the attack but on a centre line 1 mi (1.6 km) south of the original plan which he incorrectly believed was mine-free.
These orders failed to get through and the attack went ahead as originally planned.
The brigade found itself mired in mine fields and under heavy fire.
They were then counter-attacked by 21st Panzer at 11:00 and forced to withdraw.
The 23rd Armoured Brigade was destroyed, with the loss of 40 tanks destroyed and 47 badly damaged.

At 17:00, Gott ordered 5th Indian Infantry Division to execute a night attack to capture the western half of Ruweisat ridge and Deir el Shein.
3/14th Punjab Regiment from 9th Indian Infantry Brigade attacked at 02:00 on 23 July but failed as they lost their direction.
A further attempt in daylight succeeded in breaking into the position but intense fire from three sides resulted in control being lost as the commanding officer was killed, and four of his senior officers were wounded or went missing.
The Eighth Army now enjoyed a massive superiority in material over the Axis forces: 1st Armoured Division had 173 tanks and more in reserve or in transit, including 61 Grants while Rommel possessed only 38 German tanks and 51 Italian tanks although his armoured units had some 100 tanks awaiting repair.
Auchinleck's plan was for Indian Infantry 161st Brigade to attack along Ruweisat ridge to take Deir el Shein, while the New Zealand 6th Brigade attacked from south of the ridge to the El Mreir depression. At daylight, two British armoured brigades—2nd Armoured Brigade and the fresh 23rd Armoured Brigade—would sweep through the gap created by the infantry. The plan was complicated and ambitious.
The infantry night attack began at 16:30 on 21 July. The New Zealand attack took their objectives in the El Mreir depression but, once again, many vehicles failed to arrive and they were short of support arms in an exposed position. At daybreak on 22 July, the British armoured brigades again failed to advance. At daybreak on 22 July, Nehring's 5th and 8th Panzer Regiments responded with a rapid counter-attack which quickly overran the New Zealand infantry in the open, inflicting more than 900 casualties on the New Zealanders. 2nd Armoured Brigade sent forward two regiments to help but they were halted by mines and anti-tank fire.
The attack by Indian 161st Brigade had mixed fortunes. On the left, the initial attempt to clear the western end of Ruweisat failed but at 08:00 a renewed attack by the reserve battalion succeeded. On the right, the attacking battalion broke into the Deir el Shein position but was driven back in hand-to-hand fighting.
Compounding the disaster at El Mreir, at 08:00 the commander of 23rd Armoured Brigade ordered his brigade forward, intent on following his orders to the letter. Major-General Gatehouse—commanding 1st Armoured Division—had been unconvinced that a path had been adequately cleared in the minefields and had suggested the advance be cancelled. However, XIII Corps commander—Lieutenant-General William Gott—rejected this and ordered the attack but on a centre line 1 mi (1.6 km) south of the original plan which he incorrectly believed was mine-free. These orders failed to get through and the attack went ahead as originally planned. The brigade found itself mired in mine fields and under heavy fire. They were then counter-attacked by 21st Panzer at 11:00 and forced to withdraw. The 23rd Armoured Brigade was destroyed, with the loss of 40 tanks destroyed and 47 badly damaged.
At 17:00, Gott ordered 5th Indian Infantry Division to execute a night attack to capture the western half of Ruweisat ridge and Deir el Shein. 3/14th Punjab Regiment from 9th Indian Infantry Brigade attacked at 02:00 on 23 July but failed as they lost their direction. A further attempt in daylight succeeded in breaking into the position but intense fire from three sides resulted in control being lost as the commanding officer was killed, and four of his senior officers were wounded or went missing.
First Battle of El Alamein