In December 1944 a counter offensive was launched in an attempt to compel the allies to settle for negotiated peace. Hitlers generals did not support this offensive, but on the 16th of December, 30 German divisions began an attack on allied lines in the Ardennes region. In this area, allied lines had been thinned to provide support for an Autumn offensive. Evidence shows that Hitler's intention was to drive through Antwerp and cut off and destroy the British 21st Army Group and the U.S. First and Ninth Armies north of the Ardennes.

Stormy weather grounded allied air support in this region, this weather also restricted observation. During the inital stages of the attack, the German forces made large gains, but small pockets of resistance allowed for the U.S. First and Ninth Armies to shift against the northern flank of the penetration, for the British to send reserves to secure the line to the Meuse, and for Patton's Third Army to hit the salient from the south.

This attack only resulted in a bulge in the allied lines. The American forces suffered approximately 75,000 casualties in the Battle of the Bulge and the German forces lost approximately 80,000 to l00,000.

In January 1945, all ground lost by the allies had been reclaimed.
771px-Battle_of_the_Bulge.jpg
American soldiers taking up defensive positions in the Ardennes during the Battle of the Bulge.


Main Source:
http://www.worldwar2history.info/Bulge/