On the expiration of the truce, 1 May 1385, the French sent troops into Scotland, and an invasion of England from that quarter was looked for. To meet it a large army was levied, and Richard in person took the command, being attended by Lancaster and his other uncles. On 6 Aug. 1385 the expedition entered Scotland; on 20 Aug. it returned. The Scots followed their usual tactics. They left open the road to Edinburgh, but made a counter-raid into Westmoreland and Cumberland. Having entered the capital and finding the enemy in his rear, Richard at once retired. In this brief campaign Lancaster's advice in favour of bolder action was rejected. The king still regarded him with suspicion, and, as if to put a stop to his uncle's pretensions to the succession, he is said in the next parliament, 20 Oct., to have formally recognised Roger Mortimer as heir presumptive to the crown.
At this moment a convenient pretext for Lancaster's removal to a distance presented itself. His long cherished design of prosecuting his claim to the throne of Castile had at length found an opportunity. John of Avis had won the crown of Portugal, which had also been claimed by John of Castile, in the decisive battle of Albujarotta, August 1385. He had previously called to his alliance John of Gaunt, and his success afforded the latter the opening he had so long desired. Richard, not ill-pleased at the prospect of being rid of his uncle, gave him all assistance. In the winter of 1385 and beginning of 1386 preparations were pushed on. On 22 April Lancaster took leave of the king, who placed upon his head a crown of gold, while the queen paid a similar honour to the duchess; and on 7 July, accompanied by his wife and two daughters, he sailed from Plymouth with an expedition of twenty thousand men. On his way south he touched at Brest, to relieve the garrison,and thence proceeded to Corunna, where he landed 9 Aug. The next month he occupied Santiago, and thence succeeded in gaining possession of the greater part of Galicia. In the spring of 1387 he joined forces with the king of Portugal, who now married Philippa, Lancaster's daughter by his first marriage, and the combined army invaded Castile. But it met with little success, and under the heat of the climate sickness broke out among the troops. The conquests of the previous year were lost, and Lancaster himself fell ill, and was eventually forced to quit Spain and retire to Bayonne. However, he succeeded better by diplomacy than by war. The Duke of Berry had made overtures for the hand of Catharine, his daughter by his present wife, Constance. John of Castile, alarmed at the prospect of another future rival to his throne, hastened to open negotiations for the marriage of his son Henry with Catharine. A treaty was signed. Constance resigned her claim to the Castilian crown in favour of her daughter, who was taken by her mother to Spain in the following spring, and was married in September. Lancaster laid aside his assumed title of king of Castile, and received payment of two hundred thousand crowns to defray the cost of his expedition, and an annuity was settled upon him and his duchess for their lives. He was appointed lieutenant of Guienne 26 May 1388, and remained abroad till nearly the end of the following year.
By his long absence from England, Lancaster avoided taking part in the severe political crisis through which the country had been passing, and which ended in the sudden assumption of the government by the young king himself in May 1389. Lancaster returned in November. On 10 Dec. he took his seat in the council, then sitting at Reading, and by his influence is said to have succeeded in reconciling the contending parties. His arrival appears to have been welcome to Richard, who found in him some means of protection against the overbearing nature of his other uncle, Thomas of Woodstock, duke of Gloucester. During Lancaster's absence abroad Gloucester's turbulence had been one of the principal elements of disorder; but now that his brother was once more in England, Gloucester receded again into the second place, and Lancaster's influence was exerted m favour of pacification. His own ambition had in some measure been satisfied by his daughters' marriages, and for the present he appears as the supporter of his nephew's government.
On 2 March 1390 Richard created Lancaster Duke of Aquitaine for life. Two years afterwards Lancaster was the principal ambassador to the conference of Amiens, convened to negotiate a peace between England and France, to which the advance of the Turks into eastern Europe now inclined the governments of both countries. To invest him with full powers he was nominated, 22 Feb. 1392, the king's lieutenant in Picardy. The plenipotentiaries met in Lent, but neither side showed readiness to make concessions, and the only result that followed was the extension of the truce to Michaelmas of the next year. Negotiations were, however, renewed at Leulingham, 6 April 1393, Lancaster again taking the principal part, and came to a happier termination, the truce being first continued for a year, and eventually, 24 May 1394, for a further period of four years.