 The success at Ollantaytambo encouraged Manco Inca to make a renewed attempt against Cusco . However , the Spaniards discovered the Inca army concentrating near the city and mounted a night attack , which inflicted heavy casualties . On April 18 , 1537 , a Spanish army led by Diego de Almagro returned from a long expedition to Chile and occupied Cusco . Almagro imprisoned Hernando Pizarro and his brother Gonzalo because he wanted the city for himself ; most Spanish troops and their auxiliaries joined his side . He had previously tried to negotiate a settlement with Manco Inca but his efforts failed when both armies clashed at Calca , near Cusco . With the Spaniards ' position consolidated by Almagro 's reinforcements , Manco Inca decided that Ollantaytambo was too close to Cusco to be tenable so he withdrew further west to the town of Vitcos . Almagro sent his lieutenant Rodrigo Orgóñez in pursuit with 300 Spaniards and numerous Indian auxiliaries . In July 1537 , Orgoñez occupied and sacked Vitcos taking many prisoners , but Manco managed to escape . He took refuge at Vilcabamba , a remote location where the Neo @-@ Inca State was established and lasted until the capture and execution of Túpac Amaru , its last emperor , in 1572 . 
