During the Revolutionary War, in early January 1777, about 200 British troops took refuge in Nassau Hall after being repelled by Washington's troops on Princeton Battlefield, three miles south of campus. Washington's vanguard, commanded by General Sullivan, set up a single gun on the rise where Blair Arch currently stands, and fired three or four rounds at Nassau Hall. One cannonball hit the building, leaving an impression that is still visible today; another went through a window in the Faculty Room and decapitated the portrait of King George II. The British troops may have seen this as an omen, since they promptly withdrew from the building. Some 40 Americans were killed or wounded in the battle, while the British suffered 85 killed and wounded, and lost another 200 prisoners.

The Battle of Princeton, along with the Battle of Trenton, was a turning point in the Revolutionary War. Having suffered grave defeats in New York in 1776, Washington now proved that his army could win; in addition, he now held a firm position in strategic New Jersey, which lay between the two great colonial cities of New York and Philadelphia.