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The British were in a war with the french at the time, and they decided to impress the sailors and passengers of all American ships passing by. They still thought that the Americans were rebels of Britain, but were still citizens of the British Country.
As a result the American government decided they would not retaliate with force because they wanted to stay away from violence. So, passed the Embargo Act that banned all foreign trade with other countries.
The citizens who based their lives on trade with foreign countries did not respond well to this Act. They no longer had any one to trade with and the ports were empty with no goods. They wanted to continue trade, and some even wanted war against Britain. This caused the Embargo Act to fail and it eventually led to a war.
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