The presence of Lander’s troops aroused the town and threw it into terrible commotion. In vain Lander searched the distant hills, impatient for Kelly’s appearance. The hour of attack had arrived and passed. The men became impatient as their leader, who, in his indomitable courage commenced the battle with a portion of his forces.

When Lander gave the order his eager men sprang to their posts, and the artillery opened fire. As the first gun awoke its thunder on the encampments, Kelly advanced, but in the wrong direction. He instantly comprehended Lander’s action, and with prompt courage charged upon the encampments. The batteries had by this time obtained the range, and were pouring in their messengers of terror and death, tearing through tents and cabins, and scattering the rebels like chaff in every direction. After firing a volley of musketry, Lander advanced.

Colonel Kelly’s command was close upon the enemy, the Virginia troops in advance, the Henry Clay Guards in front, and Colonel Kelly and Captain Fordyce leading, while Colonel Lander’s force came rushing down the hill to the bridge and joined in an impetuous pursuit of the fugitives. Colonel Kelly, who, with a bravery amounting almost to rashness, had been foremost from the very first, was shot by a concealed foe, the ball entering the left breast and lodging beneath the shoulder blade. As his men conveyed him to a place of safety, this brave man, while in the agony of his pain, exclaimed, “I expect I shall have to die. I would be glad to live, if it might be, that I might do something for my country, but if it cannot be, I shall have at least the consolation of knowing that I fell in a just cause.” But he was not destined to be cut off in the zenith of his fame and usefulness. After a few weeks of danger and anguish he was again performing noble duty for the country he loved so well.

In this dashing victory fifteen of the rebels were killed, a large number wounded, and ten taken prisoners, together with a quantity of camp equipage, arms, &c. The organization of the rebels at that point was completely broken up, and the men driven to the mountains.

GREAT DESTRUCTION OF RAILROAD PROPERTY.

The bitter animosity of the rebel army was strikingly illustrated on the 23d July, by the destruction of a large number of locomotives and cars of the Baltimore and Ohio railroad by secession troops under the command of Colonel Thomas J. Jackson. Forty-eight locomotives and three hundred cars were blown up or burned, one of the engines having been previously wrapped in our national ensign. The road had been rendered impassable by the destruction of bridges, and, therefore, the rolling stock could not have been rendered available. The estimated loss was about three-quarters of a million of dollars.

GENERAL McCLELLAN IN WESTERN VIRGINIA.

General McClellan, during the time that elapsed since his appointment, had been actively engaged in organizing his forces and getting them ready for efficient service. Scouting parties—an important feature of his department—were detailed for service, and raw troops replaced by experienced men. Colonel Kelly, who was now recovering from the wounds received at Phillipi, had been appointed by Governor Pierpont to the command of the Virginia brigade of volunteers. Gens. Morris, Hill, Schenck and Schleich were assigned their respective positions—the telegraph lines were put in order, and new ones for military purposes were constructed where necessary. The arrival of fresh regiments, among which Colonel Rosecranz made his appearance, added great activity to the department. On the side of the enemy were Generals Robert S. Garnett, Henry A. Wise, Ex-Governor, John B. Floyd, Ex-Secretary of War, and Colonel Pegram.

Columns of Federal troops were dispatched to attack the enemy, simultaneously, at three different points, and the first collision between them occurred on the 10th of July.

BATTLE OF SCAREYTOWN.