Following the Planemeld, the bridges to the Imperial City were cut off, blocking Imperial forces from entering the city and fighting the Daedra. Inside the city, the Legion that was garrisoned there, Legion Zero, swore oaths to Molag Bal and became mind shriven, helping his minions conquer the city. The three Alliances aimed to conquer the Imperial City, so they fought amongst themselves and against Molag Bal's forces.
In the end, the Vestige destroyed the Anchor above the Imperial City, helped relight the Dragonfires and caused harm to the Daedric and Legion Zero forces. An unknown period of time afterwards, the city was liberated.