In his final full season at Newcastle, the 1997–98 season, Gillespie put in arguably his best performance for the club when assisting two of Faustino Asprilla's three goals in a 3–2 Champions League victory over FC Barcelona on 17 September 1997. He also scored what he later claimed was his best goal for the club when playing up front due to an injury crisis at home to Blackburn Rovers in 1-1 draw on 25 October 1997. He also helped Newcastle to reach the FA Cup final. However, a foot injury sustained in a 0–2 defeat at Tottenham Hotspur F.C on 25 April 1998 meant, despite a fitness test, he was not in the squad for the final and Newcastle lost to Arsenal. Despite being in manager Kenny Dalglish plans, the following pre-season Gillespie failed a medical at Middlesbrough F.C but eventually departed Tyneside in a £2.3 million move to Blackburn Rovers following the appointment of Ruud Gullit as manager and a final appearance in a 2–2 draw at Middlesbrough on 6 December 1998.