Battle of Chancellorsville
In light of the continued Federal inactivity, by late March Longstreet's primary assignment became that of requisitioning provisions for Lee's forces from the farmers and planters of North Carolina and Virginia. As a result of this the two divisions of Maj. Gen. John Bell Hood and Maj. Gen.  George Pickett were 130 miles (210 km) away from Lee's army and would take a week or more of marching to reach it in an emergency. After nearly a year of campaigning, allowing these troops to slip away from his immediate control was Lee's gravest miscalculation. Although he hoped to be able to call on them, these men would not arrive in time to aid his outnumbered forces.

Battle: 

May 1: Hooker passes on opportunity: Jackson's men began marching west to join with Anderson before dawn on May 1. Jackson himself met with Anderson near Zoan Church at 8 a.m., finding that McLaws's division had already arrived to join the defensive position. But Stonewall Jackson was not in a defensive mood. He ordered an advance at 11 a.m. along two roads toward Chancellorsville: McLaws's division and the brigade of Brig. Gen. William Mahone on the Turnpike, and Anderson's other brigades and Jackson's arriving units on the Plank Road.
At about the same time, Hooker ordered his men to advance on three roads to the east: two divisions of Meade's V Corps (Griffin and Humphreys) on the River Road to uncover Banks's Ford, and the remaining division (Sykes) on the Turnpike; and Slocum's XII Corps on the Plank Road, with Howard's XI Corps in close support. Couch's II Corps was placed in reserve, where it would be soon joined by Sickles's III Corps.
The first shots of the Battle of Chancellorsville were fired at 11:20 a.m. as the armies collided. McLaws's initial attack pushed back Sykes's division. The Union general organized a counterattack that recovered the lost ground. Anderson then sent a brigade under Brig. Gen. Ambrose Wright up an unfinished railroad south of the Plank Road, around the right flank of Slocum's corps. This would normally be a serious problem, but Howard's XI Corps was advancing from the rear and could deal with Wright.
Sykes's division had proceeded farther forward than Slocum on his right, leaving him in an exposed position. This forced him to conduct an orderly withdrawal at 2 p.m. to take up a position behind Hancock's division of the II Corps, which was ordered by Hooker to advance and help repulse the Confederate attack. Meade's other two divisions made good progress on the River Road and were approaching their objective, Banks's Ford.

Despite being in a potentially favorable situation, Hooker halted his brief offensive. His actions may have demonstrated his lack of confidence in handling the complex actions of such a large organization for the first time (he had been an effective and aggressive division and corps commander in previous battles), but he had also decided before beginning the campaign that he would fight the battle defensively, forcing Lee, with his small army, to attack his own, larger one. At the [First] Battle of Fredericksburg (December 13, 1862), the Union army had done the attacking and met with a bloody defeat.
Hooker knew Lee could not sustain such a defeat and keep an effective army in the field, so he ordered his men to withdraw back into the Wilderness and take a defensive position around Chancellorsville, daring Lee to attack him or retreat with superior forces at his back. He confused matters by issuing a second order to his subordinates to hold their positions until 5 p.m., but by the time it was received, most of the Union units had begun their rearward movements. That evening, Hooker sent a message to his corps commanders, "The major general commanding trusts that a suspension in the attack to-day will embolden the enemy to attack him."

Hooker's subordinates were surprised and outraged by the change in plans. They saw that the position they were fighting for near the Zoan Church was relatively high ground and offered an opportunity for the infantry and artillery to deploy outside the constraints of the Wilderness. Meade exclaimed, "My God, if we can't hold the top of the hill, we certainly can't hold the bottom of it!" Viewing through the lens of hindsight, some of the participants and many modern historians judged that Hooker effectively lost the campaign on May 1. Stephen W. Sears observed, however, that Hooker's concern was based on more than personal timidity.
The ground being disputed was little more than a clearing in the Wilderness, to which access was available by only two narrow roads. The Confederate response had swiftly concentrated the aggressive Stonewall Jackson's corps against his advancing columns such that the Federal army was outnumbered in that area, about 48,000 to 30,000, and would have difficulty maneuvering into effective lines of battle. Meade's two divisions on the River Road were too far separated to support Slocum and Sykes, and reinforcements from the rest of the II Corps and the III Corps would be too slow in arriving.
As the Union troops dug in around Chancellorsville that night, creating log breastworks, faced with abatis, Lee and Stonewall Jackson met at the intersection of the Plank Road and the Furnace Road to plan their next move. Jackson believed that Hooker would retreat across the Rappahannock, but Lee assumed that the Union general had invested too much in the campaign to withdraw so precipitously. If the Federal troops were still in position on May 2, Lee would attack them. As they discussed their options, cavalry commander J.E.B. Stuart arrived with an intelligence report from his subordinate, Brig. Gen. Fitzhugh Lee.
Although Hooker's left flank was firmly anchored by Meade's V Corps on the Rappahannock, and his center was strongly fortified, his right flank was "in the air." Howard's XI Corps was camped on the Orange Turnpike, extending past Wilderness Church, and was vulnerable to a flanking attack. Investigations of a route to be used to reach the flank identified the proprietor of Catharine Furnace, Charles C. Wellford, who showed Jackson's cartographer, Jedediah Hotchkiss, a recently constructed road through the forest that would shield marchers from the observation of Union pickets. Lee directed Jackson to make the flanking march, a maneuver similar to the one that had been so successful prior to the Second Battle of Bull Run (Second Manassas). An account by Hotchkiss recalls that Lee asked Jackson how many men he would take on the flanking march and Jackson replied, "my whole command."

May 2: Jackson's flank attack: Early on the morning of May 2, Hooker began to realize that Lee's actions on May 1 had not been constrained by the threat of Sedgwick's force at Fredericksburg, so no further deception was needed on that front. He decided to summon the I Corps of Maj. Gen. John F. Reynolds to reinforce his lines at Chancellorsville. His intent was that Reynolds would form up to the right of the XI Corps and anchor the Union right flank on the Rapidan River.
Given the communications chaos of May 1, Hooker was under the mistaken impression that Sedgwick had withdrawn back across the Rappahannock and, based on this, that the VI Corps should remain on the north bank of the river across from the town, where it could protect the army's supplies and supply line. In fact, both Reynolds and Sedgwick were still west of the Rappahannock, south of the town.
Hooker sent his orders at 1:55 a.m., expecting that Reynolds would be able to start marching before daylight, but problems with his telegraph communications delayed the order to Fredericksburg until just before sunrise. Reynolds was forced to make a risky daylight march. By the afternoon of May 2, when Hooker expected him to be digging in on the Union right at Chancellorsville, Reynolds was still marching to the Rappahannock.
Meanwhile, for the second time, Lee was dividing his army. Jackson would lead his Second Corps of 28,000 men around to attack the Union right flank while Lee exercised personal command of the remaining two divisions, about 13,000 men and 24 guns facing the 70,000 Union troops at Chancellorsville. For the plan to work, several things had to happen. First, Jackson had to make a 12-mile (19 km) march via roundabout roads to reach the Union right, and he had to do it undetected. Second, Hooker had to stay tamely on the defensive. Third, Early would have to keep Sedgwick bottled up at Fredericksburg, despite the four-to-one Union advantage there. And when Jackson launched his attack, he had to hope that the Union forces were unprepared.
Confederate cavalry under Stuart kept most Union forces from spotting Jackson on his long flank march, which started between 7 and 8 a.m. and lasted until midafternoon. Several Confederate soldiers saw the Union observation balloon Eagle soaring overhead and assumed that they could likewise be seen, but no such report was sent to headquarters.