While Edward was thus occupied in the Marches, Warwick was faced with the task of defending London from the oncoming Lancastrian horde. Much has been written about Margaret of Anjou and her terrifying army of Northerners and Scots, and much of this is ultimately based on the comments of the Croyland Chronicler, whose mother was obviously scared by someone from Yorkshire. (Unfortunately my copy of the CC is out on loan so I can't quote it.) My feeling is that the general impression that this Lancastrian Army was a sort of cross between Atilla the Hun and the Waffen SS is exaggerated. But it was a medieval army, probably not outstandingly well disciplined and several towns including Stamford, Grantham, Peterborough and Royston are reported as having been pillaged.
Warwick was outnumbered. He had with him his brother, John Neville, Lord Montagu and the Duke of Norfolk. He also had Henry VI in the camp, and since Henry was of little value militarily this was almost certainly to demonstrate that the 'Yorkists' were actually the official 'Lancastrian' army, representing the lawful government - meaning that the other lot were rebels.
Margaret of Anjou would not have seen it that way. She was with her army and is often said to have commanded it; I suspect her role was actually political rather than military, setting the policy rather than deciding on tactics. With her, among others, were Somerset, Northumberland and Clifford, all these relatively young men keen to avenge the deaths of their fathers at the first St. Alban's.
Warwick took up a position blocking the road north of the town. He strengthed his position with various defensive devices such as calthrops - multi spiked pieces of metal designed to repel cavalry - and cannon and (in modern parlance) 'dug himself in'. He has been criticised for this, but it is not unreasonable to fight defensively against a superior enemy and, it should be noted, it was very much in the English tradition to do so. Many victories against the Scots and French had been based on defensive tactics.
Warwick's troops were rather thinly spread over something like four miles, and communication was far from perfect. The earl himself either had insufficient intelligence as to the whereabouts of the enemy or he was confused by the reports coming in. These were the real roots of his difficulty.
Unfortunately for Warwick, Margaret arrived from an unexpected direction. Her army overwhelmed a small defence at Dunstable (led by a butcher and so probably a purely local arrangement) and then (moving by night) attacked the town of St. Alban's itself at dawn of 17 February 1461, thus getting behind Warwick's fixed position. Warwick had left a small garrison in the town, mainly archers. These put up a stubborn defence, especially considering they were isolated, and were not dealt with until noon.
Montagu, nearest to the scene, seems to have thought that the Lancastrians were merely mounting a diversion and was quite late to figure out this was a main attack. When the penny dropped he shifted his position and sent word to Warwick for support. In the interim he faced an attack by the main body led by Somerset and Trollope.
Warwick was slow to react, for whatever reason. Allegedly he had a traitor in his camp, one Lovelace, who gave bad counsel, but he himself may have been uncertain about what was going on and reluctant to abandon his carefully-prepared position. By the time he advanced to help Montagu, it was too late. He withdrew in good order in the falling darkness taking 4000 men with him. Whatever his errors, this feat alone should not be underestimated. (A total rout was more usual in such circumstances.)
Henry VI had supposedly been left in the care of Lord Bonville and Sir Thomas Kyriell. These men were executed along with a captain named Gower. On the other hand, Montagu's life was spared. It is alleged that the Prince of Wales ordered these deaths, but as he was only 7 he was clearly under instructions even if he did. It's also said that Henry wanted to spare Bonville and Kyriell but was over-ruled. Equally it's said Montagu was spared at Henry's request! Propaganda obviously plays its part here and the objective truth is anyone's guess.
This was a Lancastrian victory of some importance, and yet not nearly as complete as it looked. The advantage was soon to be lost.