In May 1852, Bayley accompanied Hughes to the First Plenary Council of Baltimore, where the American bishops decided to erect a number of new dioceses. On July 29, 1853, Pope Pius IX established the Diocese of Newark, and named Bayley as its bishop. The diocese was to embrace the whole state of New Jersey, which had previously been divided between the Diocese of Philadelphia and the Archdiocese of New York. On October 11, Bayley wrote to Cardinal Fransoni acknowledging the reception of the bulls and accepting the nomination.