The 18th Brigade and other Australian units inflicted the first decisive defeat of the Japanese on land in World WarII at Milne Bay and then at Buna and Sanananda in January 1943. The 21st Brigade and the militia 39th Battalion won a costly victory at Gona in December 1942. George Vasey took over command of the Australian 7th Division in October 1942, until his death in a plane crash in 1945. Major General Milford then took over command until the end of the war. In 1943, the Division was airlifted from Port Moresby to Nadzab in the Markham Valley. After an advance on Lae, the Markham and Ramu Valleys were soon swept clear of Japanese troops. A bloody campaign in the mountains of the Finisterre Ranges followed. .
The Australian 7th Division returned to Australia in triumph. The troops trained in the Atherton Tablelands in Queensland, preparing for the push to clear the Japanese from the Pacific Islands. In July 1945, the Australian 7th Division invaded Balikpapan in Borneo against stiff opposition. The Japanese were relentlessly pushed back, until 15 August 1945 when it was announced that the war with Japan had been won. The 7th Division's war was over. .
A total of five Victoria Crosses were awarded to the Australian 7th Division. The brave recipients were Lt Roden Cutler, Pte Jim Gordon, Cpl John French (killed in action), Pte Bruce Kingsbury (killed in action) and Pte Richard Kelliher. Private Bruce Kingsbury enlisted in the AIF on 29 May 1940 and was posted to the 2/14th Battalion on 7 June 1940. He won a Victoria Cross fighting in Papua New Guinea. The action in which Kingsbury was awarded his medal took place in the first major campaign in New Guinea when the Japanese tried to push a large force southwards from Buna and Gona across the Owen Stanley Ranges towards Port Moresby. From 27 August 1942 the Battalion had been holding positions on the main line of the Japanese advance at Isurava about 13 kilometres past Kokoda on the trial over the mountains.