On 16 October, the Red Army launched its first attack on East Prussia, the Gumbinnen Operation, the 549th defending positions north of Eydtkau. It was gradually pushed back by the 11th Guards Army, but prevented a breakthrough; 11th Guards captured Eydtkau the next day, exposing the southern flank of the 549th. Elements of the division retreated west to Ebenrode, where the reserve 103rd Panzer Brigade launched a counterattack that halted the Soviet advance, which was shifted south towards Nemmersdorf due to boggy ground. For the next several days the division held on between Ebenrode and Schlossberg with the support of the 276th Assault Gun Brigade, as the Soviet offensive came to an end. In October, it returned to XXVI Army Corps, still part of 3rd Panzer Army.