Well that's an oversimplification. Diseases wiped out 90% before they ever saw a soldier. BUT...
'Instead, when the Indians were ready to leave, Trent wrote: "Out of our regard for them, we gave them two Blankets and an Handkerchief out of the Small Pox Hospital. I hope it will have the desired effect."' -- http://www.history.org/foundation/journal/spring04/warfare.c...
More commonly rumored to be used by British against Americans, though.
'Instead, when the Indians were ready to leave, Trent wrote: "Out of our regard for them, we gave them two Blankets and an Handkerchief out of the Small Pox Hospital. I hope it will have the desired effect."' -- http://www.history.org/foundation/journal/spring04/warfare.c...
More commonly rumored to be used by British against Americans, though.