Between late December 1901 and early January 1902 Gallaher and his contingent were involved in a number of skirmishes. He described one incident where he had several Boer fighters in his sights, but did not have "the heart" to fire at them while they rescued one of their comrades. Describing a later encounter to his sister, Gallaher wrote: "We had a total of 22 killed and 36 injured and a few taken prisoners[;] it was a pretty mournful sight to see the Red Cross bearers cruising around the field fetching all the dead and wounded who were laying all over the place". By March 1902 Gallaher had reached the rank of squadron sergeant-major, and his contingent was on its way to Durban. There the unit boarded ship for New Zealand, but Gallaher stayed behind, transferring to the Tenth New Zealand Contingent. His new unit did not see active service in South Africa, and he returned with them to New Zealand in August 1902. For his service Gallaher received the Queen's South Africa Medal (Cape Colony, Orange Free State, and Transvaal Clasps), and King's South Africa Medal (South Africa 1901 and South Africa 1902 Clasps).
