McGugan missed the start of the 2007–08 campaign due to an ankle injury that required surgery. He scored his first league goal of the season with a 20-yard strike in Forest's 2–2 draw with Northampton Town. He scored his fourth goal of the season, in the second minute of stoppage time, in the New Year's Day 2–1 home win over Huddersfield a goal; the strike would win him the club's goal of the season for the second year running. Manager Colin Calderwood went on to say that "he's a young player with a wonderful future ahead of him." McGugan signed a new three-and-a-half year deal in February. He did not score again until April, but then scored three goals in Forest's last four matches of the season, including a free-kick against Yeovil Town in the "Reds" 3–2 win on the last day of the campaign, which saw Forest promoted into the Championship as runners-up of League One.