The Challenge of War Gods is a crucial event that happened sometime after Kratos had forsworn his service to Ares.
God of War Novel[]
After Kratos, the Fist of Ares has broken his oath to his master and subsequently destroyed the Furies to escape their judgement, he was free and pledged himself to the Gods of Olympus, specifically the Goddess Athena to be their Champion on his path to atone and redeem himself. In order to solidify her hold over the Ghost of Sparta, Athena made a scheme to take over the divine command over all the armies of humanity for herself, instead of leaving her brother Ares some room to manuever to get his former servant back.
While it is not known what the Challenge was, it was an important event, most notably attended by Zeus, the King of the Gods and his brother Poseidon, the Ruler of the Oceans. Athena would later refer to it as a bargain, but any other details are not known, except that Athena won the Challenge and with it the armies of humanity, but most importantly Kratos to her sole command.
Ares, from this point forward, would only have command over the dead warriors and monsters of the Underworld, aswell as the foul offspring of Typhon and Echidna. His sister Athena would later claim that his "lust for bloodshed overpowered his reason", when he agreed to the bargain.
Aftermath[]
Ares would realize the true meaning of her "bargain" and feel highly enraged and tricked, his rage at Athena and his father Zeus only growing by the day. The underhanded and scheming nature of his sister outright repulsed him. This wasnt lost on Zeus either, who told his daughter that Ares didnt realize what exactly her bargain would entail.
The God of War would regularly send his legions and hordes of monsters to harass and try to kill Kratos and stopped dwelling on Mt. Olympus, spending his time on Earth, doing his duties in a more direct, personal approach. His resentment and rage reached a breaking point after the incident on the Aegean Sea, where Athena has sent a Hydra to fight against Kratos and in doing so, turn Poseidon, the Lord of the Seas against Ares, even if only temporarily.
Totally at the end of his patience and at the brink of rage-filled insanity, the God of War gathered his foul and innumerable army of Undead Legionnares and all kinds of monsters that his sister Athena so kindly bestowed on him, and ordered them to march at Athens and destroy the great city. This would catch Athena off-guard, but quickly she decided her next course of action, which would spell the doom for Ares and indeed for the entire Age of Olympus.