Just before the start of the 1985 season, McDaniel switched to cornerback. Working with defensive backs coach Ron Zook, he received considerable playing time early in the season due to injuries to starters. In Tennessee's 31–29 win over Wake Forest, he had an interception and recovered a fumble. In the first quarter of Tennessee's 30–0 shutout of Vanderbilt on November 30, Commodore tailback Carl Woods broke loose and ran 65 yards for what would have been a touchdown, but was chased down and tackled by McDaniel at the Tennessee 15-yard line. McDaniel had 3 tackles and an interception in Tennessee's 35–7 victory over Miami in the 1986 Sugar Bowl. He finished the season with 18 tackles, 13 of which were solo tackles.