Atitlán, Escuintla and Cuscatlán. The Spanish returned to the Kaqchikel capital on 23 July 1524 and on 27 July (1 Q'at in the Kaqchikel calendar) Pedro de Alvarado declared Iximche as the first capital of Guatemala, Santiago de los Caballeros de Guatemala ("St. James of the Knights of Guatemala").
Pedro de Alvarado rapidly began to demand gold in tribute from the Kaqchikels, souring the friendship between the two peoples. He demanded that the Kaqchikel kings deliver 1000 gold leaves each of 15 pesos. A Kaqchikel priest foretold that the Kaqchikel gods would destroy the Spanish and the Kaqchikel people abandoned their city and fled to the forests and hills on 28 August 1524 (7 Ahmak in the Kaqchikel calendar). Ten days later the Spanish declared war on the Kaqchikel. A couple of years later, on 9 February 1526, a group of sixteen Spanish deserters burnt the palace of the Ahpo Xahil, sacked the temples and kidnapped a priest, acts that the Kaqchikel blamed on Pedro de Alvarado.Conquistador Bernal Díaz del Castillo recounted how in 1526 he returned to Iximche and spent the night in the "old city of Guatemala" together with Luis Marín and other members ofHernán Cortés's expedition to Honduras. He reported that the houses of the city were still in excellent condition, his account was the last description of the city while it was still inhabitable.
The Spanish founded a new town at Tecpán Guatemala, with Tecpán being Nahuatl for "palace", so the name of the new town translated as "the palace among the trees". The inhabitants of Iximche were dispersed, with some being moved to Tecpán, others toSololá and to other towns around Lake Atitlán.
The Spaniards abandoned Tecpán in 1527, due to the continuous Kaqchikel attacks, and moved to the Almolonga Valley to the east, refounding their capital on the site of today's San Miguel Escobar district of Ciudad Vieja, near Antigua Guatemala.
The Kaqchikel kept up resistance against the Spanish
