Bandholtz retired from active service for disability on November 4, 1923, and was promoted to the rank of major general. He received many awards during his military career, including the Cross of Commander Order of the Crown, Cross of Commander French Legion of Honor, and Croix de Guerre with Palm. He was also honored with other foreign awards, such as the Grand Cross Montenegro Silver Medal for Valor and the Romanian Grand Cross, Order of the Cross. The latter is the only award of this class given to an American.