Combat takes place in the form of 'waves' that last 0.025 turn (so 4 waves take up 0.1 turn). Each wave is broken up into 4 passes. Craft are assumed to be at a starting distance of 4 'units', ship and defense weapons have a range of 4 units (though some tech can improve or decrease this range). Each wave, each craft may make an attack and/or move a number of units equal to their engine rank on a pass. These actions need not be in the same pass, for example a player could choose to have one of their ships move away from the enemy fleet on pass 1, and open fire on pass 3. Before each wave, each player decides what actions their fleet will take during each pass, including designating targets, and moving (privately and ahead of time). Note that ships can split their fire between multiple targets, dividing the damage as they choose between the targets, though each target beyond the first reduces the total damage value by 1. Then the wave resolves based on what actions were assigned. If ships lose targets (either by being destroyed, leaving range, etc), their attacks that pass are lost as they open fire on where their target was or simply are in too much shock to open fire right away. Waves continue until one side is either destroyed or flees (or until a ceasefire is declared of course).
If a fleet ambushes a foe, they get a free 'surprise pass' in which they may move and attack normally before normal combat begins. Any active defenses (such as point-defense modules) do not function during the surprise pass.
Ships with warp may attempt to jump during battle, doing such is declared as a pass 1 action and goes off at the completion of pass 4 of the next wave. While doing this, ships cannot take actions and lose all damage reduction granted by their engine value. Enemies can attempt to calculate your destination using their sensors in place of a move action. If your ship's destination is within the sensor range of the ship or one of their worlds or stations, they will know immediately what hex you are jumping to and when you will arrive. Jumping in battle is risky, but sometimes necessary.
After great ship battles, wreckage can often be salvaged for resources and sometimes, even for bits and pieces of alien technology. When a ship is destroyed, it leaves behind wreckage in resources equal to 1/4 of its cost, ships beyond size 4 leave wreckage equal to 1/2 their cost, as do stations (rounded down in all cases). Salvaging modules are required to recover wreckage, and supply modules required to store it (though not necessarily upon the same craft, as salvagers can simply load wreckage onto cargo ships for example). When wreckage is returned to a station or world, it is converted into resources the following turn for use during that turn. When this happens there is a small chance that your race will discover technology that is useful amongst the junk that you can study and possibly reverse engineer.
Wreckage often disperses quickly in space. After the first full turn, the total wreckage of each craft is reduced by 1/2, after the second full turn it completely disperses. If the wreckage is in orbit around a world, the wreckage disperses faster, losing 1/2 total after 0.5 turn and is completely gone after 1 full turn.
Planet and station defenses engage much in the way ships do, except they do not receive movement actions and have a base range of 6 units, and will begin combat at that range if aware of their foes (unless such defenses have modifiers that reduce or increase their range). Defenses leave wreckage behind in the same way ships and stations do.
Craft may attempt to board one another if they are at a distance of 0 units and the defender's shields are down. To determine a craft's total boarding strength, add total ship size (if multiple ships are engaged in the boarding attempt, add the total together) plus any bonuses from technology or race and your security ranks. If the attacker and defender are the same strength, each craft involved loses 1 strength (this lasts until the craft returns to a world or station to replace lost crewmen) that wave. If the defender has a higher strength, the attacking vessels each lose 2 strength that wave and the defender loses 1. If the attackers have a higher strength, the defender loses 2 strength and they each lose 1. If one has at least twice as much strength as the other, the loser(s) drop(s) by 2 strength instead and the winners lose none. Once a craft drops to 0 strength it can be captured by any craft with at least 1 boarding strength.
Ships at less than 1/2 normal boarding strength cease taking normal actions during waves while they remain locked in a boarding action. The attackers can choose to fallback during a wave, losing 1 strength on each of their craft involved in the boarding action that are falling back instead of the normal result. A defender that reduces attacking craft to 0 strength can counter-board and capture them.
Note that bonuses to boarding strength do not count as actual boarding strength in terms of the steady degrading of strength during boarding operations. Meaning for example, a size 2 ship with lots of racial and tech bonuses still gets captured after it loses 2 boarding strength (unless of course it had a combat module, but that's different).
After you capture a ship it takes quite some time to get used to. Until the crew have returned to a friendly world or station and have been aboard the alien craft for a total of 2 full turns, they will remain inexperienced with the craft. They treat the craft as though all of its non hull systems were 1 rank lower than normal. If this would cause a system to drop to 0, that system is non functional. Boarding strength of captured ships is always 1 until the ship returns to a friendly world or station to gather crewmen.
Once all of a world's defenses and all ships in that system that are defending have been eliminated, you may attempt to occupy a world. You must initiate a planetary attack, which takes 0.1 turn. The defender's strength is equal to their security rank +2 for every 5 infrastructure on the planet. The attacker's strength is equal to their total fleet size plus their security value (note that if a ship is at less than 1/2 base boarding strength, it cannot aid in planetary attacks). If the attacker has more strength then the defender, they spend 2 full turns overtaking the planet. If the attacker has at least twice the strength of the defender, it only takes 1 full turn to occupy. If the attacker has at least 3 times the strength of the defender, they overtake the planet in 0.5 turn. Occupied planets cease all construction and production, and do not gain infrastructure.
After occupying a world, the attacker can choose to either maintain the occupation, pillage the world, bombard it or conquer it. If you pillage a world, you may load up to twice the world's resources (ore/gas) into whatever supply modules the fleet has. When you pillage a world, each structure on that world is reduced by 1 rank. You may not pillage that world again until the structures have been rebuilt and the occupation lifted.
If you choose to bombard it, the structures upon the surface of the world each lose 1 rank/turn until you either cease fire or completely annihilate the defenders. To do this, your fleet must contain orbital weapons or at least one ship with the monstrous trait that is at least size 5. Bombardment can create a vast array of hazards upon the world.
Conquering a world takes a period of time equal to that of the original occupation (using the original defense and attack strengths). After such a time, you gain control of that world. Note that this counts against your normal limit of controlled planets. The world skips resource and infrastructure gain on its following turn, but afterwards you may use the world's resources and surviving structures as though they were your own. Note that conquering a world gives your race a good chance to unlock the mysteries of some of the aliens' technology.
When a defender is in danger of having one of their worlds occupied, they may choose to drop up to 4 ranks of structures on that world in an effort to prevent the enemy from taking control of them.