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The Battle of Okinawa set up the final acts of the war in two main ways.
First, there was the fact that Okinawa was the last major island that lay between places that the US controlled and the Japanese home islands. The US was going to have to threaten the Japanese home islands in a very serious way if it was to have any hope of forcing Japan to surrender. The Battle of Okinawa brought this threat home to the Japanese. After that battle, there were no more places where the enemy might be stopped and held off away from the home islands. Thus, the loss of Okinawa put the Japanese in a clearly desperate situation.
Second, there was the fact of how bloody the battle was and how many American lives it cost. This showed that an invasion of the Japanese home islands would have a horrific cost in American lives. If the Japanese had defended peripheral islands like Okinawa this fanatically, they would surely be even stronger in their defense of their home islands. This made it certain that the US would try not to invade and would, instead, drop atomic bombs if they were available.
In these ways, this battle set up the ending of WWII.
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