By September 1183, Baldwin, crippled by leprosy, could no longer function as monarch. Guy of Lusignan, who had married Baldwin's sister Sibylla of Jerusalem in 1180, was appointed regent.

On August 24, 1183, Saladin returned to Damascus, having conquered Aleppo and several cities in Mesopotamia for his empire. Crossing the Jordan River, the Ayyubid host plundered the abandoned town of Baisan. Continuing west, up the Jezreel Valley, Saladin established his army near some springs about 8 km southeast of al-Fule. At the same time, the Muslim leader sent out numerous columns to damage as much property as possible. The raiders destroyed the villages of Jenin and Afrabala, attacked the monastery on Mount Tabor and wiped out a contingent from Kerak that was trying to join the Crusader field army.

Expecting an attack, Guy of Lusignan mustered the Crusader host at La Sephorie. When intelligence reports detected Saladin's invasion route, Guy marched the field army to the small castle of La Fève (al-Fule). His army was swollen by pilgrims and Italian sailors to a size of 1,300–1,500 knights, 1,500 turcopoles and over 15,000 infantry. This was said to be the largest Latin army assembled "within living memory." He skirmished with Saladin's Ayyubid army for more than a week in September and October 1183. The fighting ended on 6 October with Saladin being forced to withdraw.

Guy was harshly criticized by some for failing to fight a major battle when in command of such a large host. Others, mostly native barons such as Raymond III of Tripoli, supported his cautious strategy. They pointed out that Saladin's army was drawn up on rough ground, unsuitable for a Frankish heavy cavalry charge. Soon after this battle, Guy lost his position as regent.