This war took place because Uriel Septim III declared that the current ruler, Kintyra II, was a bastard child, and alluded to the famous decadence of the Imperial City at the time. Once this failed to stop her coronation, he instead gathered the armies loyal to him, those of High Rock, northern Morrowind and Skyrim, and attacked the Empire, alongside his mother, Potema Septim, who later became known as the Wolf Queen of Solitude. There was a lengthy time period as he was conquering the Empire. This battle became known as the War of the Red Diamond, after Tiber Septim's famous diamond. Evidence suggests that this diamond belonged to Saint Alessia 
On Uriel III's side, there was his mother, Potema, and the forces of High Rock, northern Morrowind, and Skyrim. On the opposing side, there was Pelagius II's surviving children (Antiochus Septim being already deceased), Imperial loyalists and many of the kings of Tamriel although many of them refused to become directly involved.
It took a fair while for Uriel III to successfully conquer the majority of the empire, despite the Imperial City falling within two weeks. As such, it was not until 3E 121 that he was able to declare himself the new Emperor, having secured a large enough portion of the Empire in which to do so.
Despite his true name being Uriel Mantiarco, he took the name Uriel Septim instead, becoming Uriel III. During the Battle of Ichidag, Uriel III was captured by enemy forces, and it was decided to send him to Imperial City so he could face trial for his actions. Unfortunately for him, his convoy was attacked by a group of vigilantes on the route there, and he was killed in the process.
Soon afterwards, by popular consent, Cephorus Septim was chosen by the people to rule the Empire. However, the War of the Red Diamond was not yet over, for the Wolf Queen was still undefeated, and continued to harass the Empire's forces.
The Battle ContinuesEdit
The Wolf Queen continued to attack the Empire's forces for the next decade. It was only after she died in one of the many sieges upon her city of Solitude that the war of the Red Diamond was finally over, and a modicum of peace settled over the Empire once more.