Gallacher started his Scottish League career with Dundee United, where he spent seven years as part of a successful team under the guidance of Jim McLean. He made his first team debut in December 1985 aged 19 years old in a UEFA Cup tie against Neuchâtel Xamax and three days later played against Rangers at Ibrox. He soon established himself in the side with his fast and penetrating wing play. He helped United reach the 1987 UEFA Cup Final, scoring against Barcelona in the quarter-finals en route. United, however, lost on aggregate to IFK Göteborg. The following year Gallacher scored Dundee United's goal in the 1988 Scottish Cup Final, in the 2–1 defeat by Celtic. A week later he made his full international debut for Scotland against Colombia.