In 1911, Lloyd George made his famous Mansion House speech, in which he warned Germany that Britain would not tolerate interference with its international interests. After the outbreak of World War I, Lloyd George remained chancellor until 1915 when he became minister of munitions. He was then (1916) minister of war before he succeeded (Dec., 1916) in ousting Asquith and formed his own coalition government.

Lloyd George immediately reorganized the structure of the government, creating a small war cabinet of five (which when attended also by representatives of the dominions and India became the Imperial war cabinet) and forming for the first time a cabinet secretariat. His war policy was bold and aggressive, and, although he was often at odds with the military leaders, he was largely responsible for the unification of military command under Marshal Ferdinand Foch. At the Paris Peace Conference (1919), Lloyd George exercised a moderating influence on both the harsh demands of Georges Clemenceau and the idealistic proposals of Woodrow Wilson, and to a large extent he shaped the final agreement (see Versailles, Treaty of).

A general election in 1918 had given Lloyd George and his coalition a substantial majority, but he was heavily dependent on Conservative support. This fact accounts at least partially for the repressive policy he adopted in Ireland, although he finally concluded the treaty that set up (1922) the Irish Free State. In 1922 the Chanak crisis occurred, in which Lloyd George delivered an ultimatum to the Turks, who, having seized Smyrna from the Greeks, were poised to strike across the neutralized Straits zone. The Turks agreed to withdraw, but in Britain Lloyd George was accused of recklessness. The Conservatives withdrew from the coalition, and his ministry fell (1922).

Lloyd George continued to be active in Parliament and, despite the fact that he was disliked by many Liberals for his treatment of Asquith, served (1926-31) as the leader of the by-then shattered Liberal party. In 1936 he visited and was much impressed by Adolf Hitler, but he later attacked the policy of appeasing Nazi Germany. He was raised to the peerage only a few months before his death.