Japan invaded Manchuria outright after the Mukden Incident in September 1931. After the Japanese captured Qiqihar in the Jiangqiao Campaign, the Japanese 4th Mixed Brigade moved toward Harbin, closing in from the west and south. Bombing and strafing by Japanese aircraft forced the Chinese army to retreat from Harbin. Within a few hours, the Japanese occupation of Harbin was complete.[46]

With the establishment of the puppet state of Manchukuo, the so-called "pacification of Manchukuo" began, as volunteer armies continued to fight the Japanese. Harbin became a major operations base for the infamous medical experimenters of Unit 731, who killed people of all ages and ethnicities. All these units were known collectively as the Epidemic Prevention and Water Purification Department of the Kwantung Army.[47] The main facility of the Unit 731 was built in 1935 at Pingfang District, approximately 24 km (15 mi) south of Harbin urban area at that time.[48] Between 3,000 and 12,000 citizens including men, women, and children[49][50]—from which around 600 every year were provided by the Kempeitai[51]—died during the human experimentation conducted by Unit 731 at the camp based in Pingfang alone, which does not include victims from other medical experimentation sites.[52] Almost 70 percent of the victims who died in the Pingfang camp were Chinese, including both civilian and military.[53] Close to 30 percent of the victims were Russian.[54] The Russian Fascist Party had the task of capturing "unreliable" Russians living in Harbin to hand over to Unit 731 to serve as the unwilling subjects of the gruesome experiments.[55] Some others were South East Asians and Pacific Islanders from then-colonies of the Empire of Japan, and a small number of the prisoners of war from the Allies of World War II[56] (although many more Allied POWs were victims of Unit 731 at other sites). Prisoners of war were subjected to vivisection without anesthesia, after being infected with various diseases.[57] Prisoners were injected with inoculations of disease, disguised as vaccinations, to study their effects. Unit 731 and its affiliated units (Unit 1644 and Unit 100 among others) were involved in research, development, and experimental deployment of epidemic-creating biowarfare weapons in assaults against the Chinese populace (both civilian and military) throughout World War II. Human targets were also used to test grenades positioned at various distances and in different positions. Flame throwers were tested on humans. Humans were tied to stakes and used as targets to test germ-releasing bombs, chemical weapons, and explosive bombs.[58][59] Twelve Unit 731 members were found guilty in the Khabarovsk War Crime Trials but later repatriated; others received secret immunity by the Supreme Commander of the Allied Powers Douglas MacArthur before the Tokyo War Crimes Tribunal in exchange for biological warfare work in the Cold War for the American Force.[60]

Three different nationalities – Chinese, Japanese and Russian – on Kitaiskaia Street

Chinese revolutionaries including Zhao Shangzhi, Yang Jingyu, Li Zhaolin, Zhao Yiman continued to struggle against the Japanese in Harbin and its administrative area, commanding the main anti-Japanese guerrilla army-Northeast Anti-Japanese United Army—which was originally organized by the Manchurian branch of the Communist Party of China (CPC). The army was supported by the Comintern after the CPC Manchurian Provincial Committee was dissolved in 1936.

Anti–communist Russian Fascist Party Blackshirts, inspired by Italian Fascism, at Harbin Railway Station, 1934, waiting for arrival of their leader Konstantin Rodzaevsky

Under the Manchukuo régime and Japanese occupation, Harbin Russians had a difficult time. In 1935, the Soviet Union sold the Chinese Eastern Railway (KVZhD) to the Japanese, and many Russian emigres left Harbin (48133 of them were arrested during the Soviet Great Purge between 1936 and 1938 as "Japanese spies"[61]).[36] Most departing Russians returned to the Soviet Union, but a substantial number moved south to Shanghai or emigrated to the United States and Australia. By the end of the 1930s, the Russian population of Harbin had dropped to around 30,000.[62]

Many of Harbin's Jews (13,000 in 1929) fled after the Japanese occupation as the Japanese associated closely with militant anti-Soviet Russian Fascists, whose ideology of anti-Bolshevism and nationalism was laced with virulent anti-Semitism.[63] The Kwantung Army-sponsored and financed the Russian Fascist Party, which after 1932 started to play an over-sized role in the Harbin's Russian community as its thugs began to harness and sometimes killed those opposed to it. Most Jews left for Shanghai, Tianjin, and the British Mandate of Palestine.[64] In the late 1930s, some German Jews fleeing the Nazis moved to Harbin. Japanese officials later facilitated Jewish emigration to several cities in western Japan, notably Kobe, which came to have Japan's largest synagogue.