He got in all the treasure from the city and stations, bought up and stored grain and supplies of every kind, brought the guns and ammunition to the residency, arranged for water supply, strengthened the residency, formed outworks, cleared away obstructions, and made every preparation for the worst. With a force of about seven hundred Europeans (32nd regiment) and seven hundred natives of doubtful fidelity, Lawrence undertook, when the news of the outbreak at Meerut reached him on 13 May, to hold both the residency and the Muchee Bawn, four miles apart. Open to criticism from a military point of view, this division of forces nevertheless showed that outward confidence which Lawrence deemed it most important to maintain.
Towards the end of May an émeute, in which several officers lost their lives, occurred at Lucknow. Lawrence followed the mutineers out of Lucknow for some distance, and prisoners were taken. On 30 May Lawrence wrote: 'We are pretty jolly. . . . We are in a funny position. While we are entrenching two posts in the city, we are virtually besieging four regiments — in a quiet way — with 300 Europeans. Not a very pleasant diversion to my civil duties. I am daily in the town, four miles off, for some hours, but reside in cantonments guarded by the gentlemen we are besieging.' The same night the long-expected outbreak occurred; the mutineers were defeated and driven out of the town, which remained comparatively quiet. But Oudh was full of disaffected native soldiery, and the Europeans at out-stations were fugitives. The wise policy of Lawrence in at once redressing grievances on assuming the government became now of great importance. With one exception none of the chiefs or of the peasantry attempted to do harm to the fugitives, while most were helpful. The mass of the people in Lucknow itself and the entire Hindoo population held wholly aloof from the outbreak, and, with one single exception, every talookdar, to whom the chance offered itself, aided more or less actively in the protection of Europeans.
Tidings of various disasters, however, caused Lawrence much anxiety. A large portion of native troops had not yet deserted, and he believed that unless he could retain some, his position would be hopeless. He therefore carefully weeded them until he had reduced the number to about the strength of the Europeans. The Sikhs were segregated and formed into companies at an early period of the crisis. Roads were kept open, cantonments held, the city kept quiet, the Muchee Bawn garrisoned and held as a fort and entrepôt, remnants of the old king's soldiers were enlisted into new bodies of police and lodged under the guns of the Muchee Bawn, while the residency and its surrounding buildings were gradually connected by a chain of parapets, and, with sundry batteries, formed into a defensive position. Lawrence telegraphed to the governor-general recommending that in case anything happened to him Major Banks should succeed him as chief commissioner, and Colonel Inglis of the 32nd should command the troops, observing that it was no time for punctilio as regards seniority. A draft telegram, in his handwriting, was found among his papers, which ended with the words: 'There should be no surrender. I commend my children and the Lawrence asylums to government.' The urgent appeals sent him by General Wheeler to send aid to Cawnpore he was forced to firmly refuse. To attempt to aid Cawnpore would, he foresaw, involve the loss of both Lucknow and that place. No sooner had Cawnpore fallen (26 June) than the mutineers who had been gathering in the neighbourhood of Lucknow moved on that city. On 29 June an advanced guard arrived at Chinhut, within eight miles of the residency, and exchanged shots with Lawrence's Sikh cavalry outpost. Lawrence determined to give the advanced guard a check at Chinhut, and accordingly at sunset evacuated cantonments, and garrisoning only the Muchee Bawn and the residency, he directed a force, consisting of 300 white and 220 native bayonets, 36 European and 80 Sikh sabres and 11 guns, to march at daybreak on the 30th. Lawrence led them in person, but the mutineers were in greater force than had been anticipated, the native artillery behaved badly, many deserted, and a repulse followed. Lawrence retreated to Lucknow, closely pursued. He covered the retreat with unfaltering courage, and was seen everywhere, oblivious of danger, inspiriting the men; but he lost 118 European officers and men, and he knew that his position was ten times worse than when he sallied out.
The disaster at Chinhut precipitated the occupation of the city by the rebels, and during the night of 30 June the insurgents closed in on the Muchee Bawn and on the residency, and opened fire early on 1 July. The Muchee Bawn was immediately abandoned and blown up, and the defence concentrated at the residency. Here Lawrence, with 927 Europeans and 768 native troops, besides women and children, was hemmed in by 7,000 mutineers. He took up his quarters in a room of the residency, much exposed, but convenient for observation.