He was afterward brevetted colonel of the 7th foot, with which he went to Canada in 1773. On the reduction of Montreal by the Americans in 1775, Colonel Prescott, who had the local rank of brigadier-general, attempted to descend to Quebec with the British troops and the military stores, but was obliged to surrender to the Americans on 17 November. In September, 1776, he was exchanged for General John Sullivan. In November he became colonel of his regiment, and in December he was third in command of the expedition against Rhode Island, where he remained in command of the British forces prior to the Battle of Rhode Island.
On Prescott Farm in Rhode Island, he was kidnapped, 10 July 1777, by Lieutenant-Colonel William Barton and a force of about 40 men including Jack Sisson. The Americans took him to Providence. Prescott was again exchanged, this time for General Charles Lee. Prescott resumed his command in Rhode Island, but was almost immediately superseded by Sir Robert Pigot.
He became a major-general, 29 August 1777, and lieutenant-general, 26 November 1782. His treatment of American prisoners was harsh and cruel. See "The Capture of Prescott by Lieutenant-Colonel William Barton", an address at the centennial celebration of the exploit, by Jeremiah Lewis Diman (Providence, 1877).