A trade war is a situation in which countries restrict each other’s trade by imposing tariffs or quota on imports. A latest example of a trade war is the one currently going on between the US and China. China with its large manufacturing base has captured the world markets. China’s growth is viewed as a threat to America’s supremacy in world trade. We focus on trade history and explore the trade statistics of China and the United States, the factors that led to the trade war, the journey of China in WTO and America’s appeal to amend WTO rules to ensure fair play. We also outline the outcome of the current war in terms of trade diversion, trade beneficiaries, reaction of NASDAQ (National Association of Securities Dealers Automated Quotations) and Shanghai stock exchange (SSE), & the impact it has on the consumers.