In 1936, after the Xian Incident, Chiang agreed to set up an alliance with the CPC in the fight against Japanese invaders.
On July 7, 1937, after the Marco Polo Bridge Incident, general war between China and Japan broke out.
Under the agreement with Chiang, CPC armies were reorganised into 8th Route Army, and Liu was appointed commander of the 129th Division, one of its three divisions.
It was then that he began his long cooperation with Deng Xiaoping, his commissar at that time.

According to the orthodox record of the CCP, their cooperation and friendship lasted more than five decades.
Their respective military and political talents complemented the other's perfectly, and there was a very high level of trust between them.
They were said to have formed a perfect pair.

However, their true relationship might not have been as close as it seemed.
Firstly, Mao distrusted most of his generals, and sent his associates out as commissars to supervise these generals.
Deng, who was Mao's close associate from 1930's when he worked in Jiangxi, was sent out for Liu, and Luo Ronghuan for Lin Biao.
Secondly, in contrast to Liu's role as a professional soldier, Deng was a political activist and knew little about the military.
Their personalities and personal lives were vastly different, which might have posed a barrier to their becoming true friends.

Liu, Deng and Deputy Commander Xu Xiangqian led their troops to Shanxi, and carried out bushfighting around Taihang Mountain.
After rounds of successful battles against the Japanese army, they set up the Jin–Ji–Yu Base Area (晉冀豫抗日根據地) which consisted of parts of Shanxi, Hebei and Henan.
In 1940, Liu led his division in the Hundred Regiments Campaign, a major campaign led by Peng to breach the blockage on CPC base areas enforced by Japanese forces under the command of General Okamura Yasuji.
At the same time, Liu integrated regular forces with militia, using frontal attack and bushfighting to frustrate the Japanese army's suppression and clean-out efforts.
The Japanese were so irritated that they sent agents to assassinate Liu.
Although their mission was a failure, they did succeed in murdering Liu's first daughter when she was kept in kindergarten.
The Japanese thought that this revenge might distract Liu, but they underestimated Liu's willpower.
His heightened loathing for the Japanese gave him more courage under fire and more inspiration in command.

In 1943, Liu was called back to Yan'an for Zheng Feng.
He pledged his allegiance to Mao and supported Mao's power struggle with Wang Ming.
On the contrary, Peng stood by Wang and as a result fell out of favour with Mao. (
Despite this, Liu was still labelled a dogmatist for pursuing his studies in Russia, and he had to make a public apology against his will in 1959.)
In 1945, Liu attended the 7th National Congress of the CPC in Yan'an, and prepared the counterattack against the Japanese and the forthcoming civil war with KMT armies.
In 1936, after the Xian Incident, Chiang agreed to set up an alliance with the CPC in the fight against Japanese invaders. On July 7, 1937, after the Marco Polo Bridge Incident, general war between China and Japan broke out. Under the agreement with Chiang, CPC armies were reorganised into 8th Route Army, and Liu was appointed commander of the 129th Division, one of its three divisions. It was then that he began his long cooperation with Deng Xiaoping, his commissar at that time.
According to the orthodox record of the CCP, their cooperation and friendship lasted more than five decades. Their respective military and political talents complemented the other's perfectly, and there was a very high level of trust between them. They were said to have formed a perfect pair.
However, their true relationship might not have been as close as it seemed. Firstly, Mao distrusted most of his generals, and sent his associates out as commissars to supervise these generals. Deng, who was Mao's close associate from 1930's when he worked in Jiangxi, was sent out for Liu, and Luo Ronghuan for Lin Biao. Secondly, in contrast to Liu's role as a professional soldier, Deng was a political activist and knew little about the military. Their personalities and personal lives were vastly different, which might have posed a barrier to their becoming true friends.
Liu, Deng and Deputy Commander Xu Xiangqian led their troops to Shanxi, and carried out bushfighting around Taihang Mountain. After rounds of successful battles against the Japanese army, they set up the Jin–Ji–Yu Base Area (晉冀豫抗日根據地) which consisted of parts of Shanxi, Hebei and Henan. In 1940, Liu led his division in the Hundred Regiments Campaign, a major campaign led by Peng to breach the blockage on CPC base areas enforced by Japanese forces under the command of General Okamura Yasuji. At the same time, Liu integrated regular forces with militia, using frontal attack and bushfighting to frustrate the Japanese army's suppression and clean-out efforts. The Japanese were so irritated that they sent agents to assassinate Liu. Although their mission was a failure, they did succeed in murdering Liu's first daughter when she was kept in kindergarten. The Japanese thought that this revenge might distract Liu, but they underestimated Liu's willpower. His heightened loathing for the Japanese gave him more courage under fire and more inspiration in command.
In 1943, Liu was called back to Yan'an for Zheng Feng. He pledged his allegiance to Mao and supported Mao's power struggle with Wang Ming. On the contrary, Peng stood by Wang and as a result fell out of favour with Mao. (Despite this, Liu was still labelled a dogmatist for pursuing his studies in Russia, and he had to make a public apology against his will in 1959.) In 1945, Liu attended the 7th National Congress of the CPC in Yan'an, and prepared the counterattack against the Japanese and the forthcoming civil war with KMT armies.
Liu Bocheng