In the reign of Edward the Martyr, Ælfhere was a leader of the anti-monastic reaction and an ally of Edward's stepmother Queen Dowager Ælfthryth. After the killing of Edward by Ælfthryth's servants in 978, Ælfhere supported the new king, Ælfthryth's son Æthelred the Unready, and was the leading nobleman in the Kingdom of England until his death in 983.
Ælfhere was promoted by King Eadwig, probably as a counter to the influence of Æthelstan Half-King and his kinsmen. Eadwig's promotion of new men, such as Ælfhere, soon faced opposition from the old guard. The crisis came in 957, and to all appearances was settled by negotiation. The English kingdom was neatly partitioned between Eadwig and his younger brother Edgar, Eadwig ruling south of the Thames, Edgar to the north. Ælfhere survived the crisis, abandoning Eadwig, and became Edgar's devoted supporter.
As the ealdorman of Mercia, Ælfhere was concerned with relations with the Welsh princes. Wars in Wales gave opportunities for fame, and for booty to be distributed to allies and kinsmen. A campaign in 983 by Ælfhere against Brycheiniog and Morgannwg, with the aid of the Welsh king Hywel ap Ieuaf, is recorded by the Annales Cambriae.
The short reign of Edward was the period of the so-called anti-monastic reaction. Ælfhere was portrayed by medieval writers, who were invariably monks, as a leader in this movement which saw the seizure of monastic lands by the magnates. In Ælfhere's case, this appears to have centred on the lands attached to monasteries founded by Oswald of Worcester which had been greatly enlarged with the assistance of the sons of Æthelstan Half-King.
The reign of Edward came to an end with his murder at Corfe Castle on 18 March 978. His stepmother Queen Ælfthryth was soon blamed for the killing, the details of which are uncertain. Edward was initially buried at Wareham, but in 979 or 980 Ælfhere and Archbishop Dunstan had the remains of the king reburied at Shaftesbury Abbey. Whether Ælfhere wished to publicly disassociate himself from the killing of Edward, or to assuage a guilty conscience—he certainly profited from Edward's death—can only be conjectured.
The Anglo-Saxon Chronicle for the year 983 records Ælfhere's death. He was buried at Glastonbury Abbey. Ælfric Cild, his sister's husband—she may have been called Æthelflæd—succeeded to some of his offices, but was exiled in 985. No children of Ælfhere are known, but two of his nephews appear in the record. Ælfric Cild's son Ælfwine was killed at the battle of Maldon in 991 and Ælfheah's son Godwine may be the same person as Godwine, ealdorman of Lindsey, who died in the battle of Ashingdon in 1016.