Philip II Augustus of France arrives at Acre to participate in the Third Crusade. Acre has been besieged by Guy of Lusignan since 1189, but he hasn't been very successful so far because Acre is one of the most heavily fortified and strongest cities in the entire region.
What's more, Saladin has moved his own forces in because he's worried about Acre being captured. So the city of Acre is under siege from Christian Crusaders and they, in turn, are also under siege by Muslim forces under Saladin. This creates a very complicated and messy situation, especially as both sides struggle for control of the waters around Acre.
The Crusader camp benefits from the steady increase in the numbers of European warriors, but the increase creates lot of problems too: there are just too many people for proper food or sanitation. Acre won't be captured by the Crusaders until King Richard I Lionheart arrives next year.