He became a friend of James Wolfe.
On March 29, 1761, as the lieutenant colonel of 72nd Regiment of Foot he took part in the attack on Belle-Ile-en-mer, an island of the coast of the northern part of the Bay of Biscay, ten miles off the coast of France. Carleton led an attack on the French, but was seriously wounded and prevented from taking any further part in the fighting. After four weeks of fighting, the British captured the rest of the island.
In 1764 he transferred to the 93rd Regiment of Foot.
The government consisted of a Governor, a council, and an assembly. The governor could veto any action of the council, but also London had given Carleton instructions that all of this actions required the approval of the council.
The officials of the province at this time did not receive a salary and received their income through fees they charged for their services. Carleton tried to replace this system with a system in which the officials instead received a salary, but this position was never supported in London. When Carleton renounced his own fees, James Murray was furious.
After James Murray resigned his position, Carleton was appointed Captain General and Governor in Chief on April 12, 1768. Carleton took the oath of office on November 1, 1768. On August 9, 1770 he sailed for England for what he thought was for a few months. During his absence Hector Theophilus de Cramahé was the lieutenant governor of the province.
He married Maria Howard, daughter of the second Earl of Effingham, who was twenty-nine years his junior, on May 22, 1772. He was promoted to Major-General in May 25, 1772. The Quebec Act of 1774 was based upon Carleton's recommendations. The French in Quebec approved of this act, while the English in Quebec were opposed. The Continental Congress sent letters to Montreal denouncing the act for being undemocratic and for making Catholicism legal. John Brown, an agent for the Boston Committee of Correspondence, arrived in Montreal to persuade the inhabitants to revolt.
Carleton received notice of the start of the rebellion in May 1775, soon followed by the news of the rebel capture of Crown Point and Fort Ticonderoga. He had previously sent two of his regiments to Boston and he had only about eight hundred regular soldiers left in Quebec. His attempts to raise a militia failed, as neither the French nor the English were willing to join. The Indians were willing to fight on the British side, and London wanted them to fight, but Carleton turned their offer down because he was worried about the Indians attacking non-combatants.
In 1775 he repelled the American attack on Quebec. Later, he drove the Americans past Trois-Rivières. In June 1776, he was appointed a Knight of the Bath. The next month he commanded British naval forces on the Richelieu River, culminating in the Battle of Valcour Island in October of that year against an American fleet led by General Benedict Arnold that featured galleys. The British, with a vastly superior fleet, were victorious, eliminating most of the American fleet. His brother, Thomas Carleton, and nephew, Christopher Carleton, both served on his staff during the campaign.
On July 1, 1777, Carleton resigned his post as Governor, but London required him to remain in his post until June 1778 when his replacement, Frederick Haldimand, had arrived. Carleton then left for England, where he had been appointed governor of Charlemont in Ireland. One of Haldimand's first acts was to have Buck Island in the St. Lawrence River fortified and renamed Carleton Island. After the Battle of Yorktown and the capitulation of Lord Cornwallis in October 1781, Sir Guy Carleton was appointed Commander-in-Chief, North America on February 22, 1782, and he arrived in New York City on May 6, 1782, succeeding Sir Henry Clinton.
In August, Carleton was informed that Britain would grant the United States its independence. Carleton asked to be relieved from his command. With this news, there came an exodus of Loyalists from the Thirteen Colonies. Carleton did his best to have them resettled outside the United States. He also resettled former slaves against the objections of the Americans who wanted all former slaves returned. In all, he resettled about 30,000. On November 28, the evacuation ended, and Carleton returned to England.
In 1783, John Campbell of Strachur succeeded him as Commander-in-Chief, North America.
The Constitutional Act of 1791 split Quebec into Upper and Lower Canada, with Sir Alured Clarke the lieutenant governor of Lower Canada and John Graves Simcoe the lieutenant governor of Upper Canada. In August 1791 Carleton left for England and on February 7, 1792 took his seat in the House of Lords. He left for Canada again on August 18, 1793.
He lived mostly at Greywell Hill, adjoining Nately Scures, in Hampshire and after about 1805 Stubbings House at Burchett's Green, near Maidenhead, in Berkshire. On November 10, 1808, he died suddenly at Stubbings and was buried in Nately Scures parish church.
Billias, George Athan,Editor, George Washington's Opponents, William Marrow and Company, Inc., New York, 1969, 103–135.