O'Malley objected to the Anglo-Irish Treaty that formally ended the "Tan War" (the term by which he and many other anti-Treaty Republicans preferred to refer to the War of Independence), opposing any settlement that fell short of an independent Irish Republic, particularly one backed up by British threats of restarting hostilities. He was one of the anti-Treaty IRA officers who occupied the Four Courts in Dublin, an event that helped to spark the Irish Civil War. O'Malley was appointed assistant chief of staff in the anti-Treaty forces.