Still further to secure his position, Stephen passed a charter closely resembling that issued under similar circumstances by his predecessor. He endeavoured to conciliate all the estates of the realm: to the clergy he promised that vacant benefices should immediately be filled up, and that their revenues should in no case be applied to the purposes of the crown; to the nobility he pledged his word that the royal forests, which Henry had appropriated to himself, should be restored to their ancient boundaries; and to the people he engaged to remit the tax of Danegeld, and to restore the laws of King Edward. Stephen also made lavish gifts of money and lands to those about him, and during the first year of his reign the land rejoiced once more in plenty and prosperity.

Matilda and her husband Geoffrey experienced no better fortune in Normandy than in England. The Norman nobility were influenced by the same reasons as formerly, in desiring a continuance of their union with the crown of England; while, at the same time, an hereditary animosity existed between them and the people of Anjou. When Geoffrey Plantagenet entered Normandy for the purpose of enforcing the rights of his wife Matilda, the Normans applied for assistance to Theobald of Blois, eldest brother of Stephen (1136). As soon as Stephen obtained possession of the English throne, they transferred their allegiance to him, and put him in possession of the government of the duchy. The homage which, as feudal sovereign, was due to Louis VII., King of France, he accepted from Eustace, Stephen's eldest son, instead of from the English king himself; and Louis also betrothed his sister Constantia to the young prince. The Count of Blois consented to resign his claim for a yearly pension of 2,000 marks, and Geoffrey of Anjou was compelled to conclude a truce of two years with Stephen, receiving also a pension of 5,000 marks.

Robert of Gloucester, the natural son of Henry, entertained the strongest feelings of hostility to Stephen. He appears, however, to have directed his efforts against the usurper rather in support of the claims of his sister Matilda, than of any pretensions of his own. On the elevation of Stephen to the throne, Robert found it necessary to take the oath of allegiance, since a refusal to do so would have resulted in the loss of his estates in England, and of that power which he proposed to use in his sister's behalf. He therefore offered to do homage on condition that the king fulfilled all his promises, and never invaded any of the rights of Robert. Thus a pretext was afforded for revolt at any moment, and the Earl of Gloucester, who was a man of considerable abilities and military reputation, occupied himself in promoting a spirit of disaffection among the nobles. The right which the English barons had obtained of erecting fortified castles was exercised to the utmost. Strong fortresses rapidly arose in all parts of the kingdom, and were garrisoned with licentious soldiery, native and foreign.

In proportion as the privileges of the nobles were extended, the condition of the people became once more one of oppression and misery. Petty wars broke out among the rival barons, who made incursions into each others' territories, and practised unbounded rapine on the towns and villages. Some of the more powerful chiefs declared that the promises made to them by Stephen on his accession had not been fulfilled; and they seized various parts of the royal estates, which they asserted were their due. Among these was Hugh Bigod, whose act of perjury had secured the coronation of Stephen, and who now revolted openly against the king, and took possession of Norwich Castle.

The insurgents had not yet learned to act in concert, and Stephen soon recovered the estates which had been seized. The spirit of sedition, however, was not repressed; new disturbances were continually taking place, and the country remained in a state of anarchy.

In the year 1137, Robert, Earl of Gloucester, having organised an extensive confederacy, quitted his estates, and having crossed the Channel, sent to the king a formal letter of defiance. Other great barons also, on the ground that the promises made to them had not been fulfilled, renounced their homage, and retired to their strongholds. A desultory warfare took place between the king and his disaffected nobles.

In March, 1138, David, King of Scotland, crossed the Tweed at the head of an army which he had collected from every part of his kingdom, to defend the title of his niece, Matilda. The chroniclers describe the Scottish army as a barbarous multitude, many of whom, gathered from the recesses of the Highlands, were fierce and untutored, half clad, and with only the rudest weapons of war. This undisciplined host passed through Northumberland into Yorkshire, devastating the country, and committing unheard of barbarities upon the miserable inhabitants. It is related of them that they behaved after the manner of wild beasts, slaying all who came in their way, sparing neither old age in its helplessness, nor beauty in its spring, nor the infant in the womb.

The fury of these massacres exasperated the northern nobility, who might otherwise have been disposed to join the King of Scotland. Thurstan, Archbishop of York, an aged man, seemed to derive new youth from the crisis which demanded the exertion of his energies. He shook off the weight of years and, organising an army, he earnestly exhorted the barons and the soldiers to defend their countrymen from the ravages of the invaders. William, Earl of Albemarle, Roger Mowbray, Robert de Ferrers, William Piercy, Walter L'Espec, and others of their compeers, assembled their troops, and encamped at Elfer-tun, now called Northallerton, about half-way between York and Durham, and there awaited the arrival of the enemy. The advance of the Scots had been so rapid that Stephen, who was occupied with repressing the rebellion in the south, had no time to reach the scene of action.

The Scottish army, the first division of which was led by Prince Henry, son of David, crossed the Tees in several divisions, bearing as a standard a lance, to which was fixed a bunch of "blooming heather." They did not form, as was the case with more disciplined armies, distinct bodies of horse and foot, but each man brought to the field of battle such arms as he could obtain. With the exception of the French or Norman knights, whom the King of Scotland brought with him, and who were armed cap-à-pie with complete suits of mail, the mass of his soldiers displayed a disorderly equipment. The men of Galloway and other parts of the west wore no defensive armour, and bore long sharp pikes or javelins as their only weapon. The inhabitants of the lowlands, who formed the chief part of the infantry, were armed with spears and breastplates; while the Highlanders, who wore a bonnet adorned with plumes, and a plaid cloak fastened at the waist by a leathern belt, appeared in the fight with a small wooden shield on the left arm, while in the right hand they bore the claymore or broadsword. The chiefs wore the same armour as their soldiers, from whom they were distinguished only by the length of their plumes.

The Anglo-Norman barons, anxious to invoke on their behalf the ancient superstitions of the English, caused the banners of St. Peter of York, St. John of Beverley, and St. Wilfrid of Ripon, to be brought from the churches in which they had remained since the time of the Conqueror, and erected them in the midst of the camp. The mast of a ship was set up in a car with four wheels; at the top of the mast was fixed a crucifix, attached to which was a silver box, containing the sacramental wafer, or eucharist, and round it were hung the banners of the three English saints.