However, as the Cold War began to heat up following the new situation in Europe elements of the British Empire and the United States worked to shore up their flagging position across Europe. Under protection of the British Navy the royalist government fled to Crete and established a rival government that claimed to be the only legitimate authority to speak for the Greek people. With assistance from British forces a Northern Greek assault on Heraklion was beaten in 1945, one of the first examples of military action undertaken by the Western Allies to secure anti-Communist governments.
With the threat of the North Greeks held off for the time being, the Western Allies began to help restore the ability of the South Greeks to hold their own against any future attack while also serving as a valuable southern base for the Allies and their Mediterranean operations. Following the 1956 Crisis and the rise of Socialist Pan-Arabism, the Kingdom of Greece became a major strategic concern for both NATO and the Alliance of Independent Leftist Republics in their bid to control the Eastern Mediterranean.
Following the establishment of North Greece the British Empire and the United States viewed South Greece as a valuable anchor to help forstall potential Soviet control over the Eastern Mediterranean, which until this point had been seen as a region off limits to Soviet influence. When it became clear that Tito and North Greece were no longer interested in supporting Soviet dominion, the Western Allies were able to breath a little, but that still did not stop their concern. North Greece had tried to take over the Greek Islands before and Western officials had little doubt that they would make another attempt in the future.
To that end they strived to restore some strength to the weakened royalist government. Fortunately, much of what remained of the Royal Greek Navy sailed to Crete with the politicians, leaving the EAM with practically no means to project power outside the mainland. What little navy North Greece did have was destroyed or crippled in the Battle of Heraklion, ensuring South Greek safety. Following this incident Greek and allied planners desired to maintain naval superiority over the North Greeks. British and Turkish support and American funds helped to make that vital task a reality. Such alliances were further cemented upon the Kingdom's ascension into NATO in 1952.
However, one sticking point between the Kingdom and the British Empire was the dispute over Cyprus. Both Greek governments claimed soveriegnty over Cyprus and its people, although South Greece, understandably, went about it with a more diplomatic approach compared to North Greece, which saw the entire British presence in the Mediterranean as imperialist. That being said, the Cyprus issue was a major concern for all parties involved. Britain wanted to cede the island to either South Greece or give it independence while Turkey instisted on the rights of Turkish Cypriots.
Determined to not lose its southern European flank to infighting, America leaned on Britian and Turkey for accept South Greek control over Cyprus while at the same time pressuring the royalist government to concede on some of their demands. After a referendum in 1950 sponsored by the Greek Orthodox Church of Cyprus in which 97% of Greek Cypriots voted for union, Great Britain ceded the island to South Greece. In exchange the royalist government agreed to maintain British military bases on Cyprus, safeguard the rights and property of all Turkish Cypriots, and expedite the emigration of any who wanted to move to Turkey. This action increased regional stablity as well as removing one of the disputes within NATO.