After his arrival in New Spain, Gálvez commenced at once visiting the provinces, giving much attention to Sonora where an Indian revolt menaced frontier settlements. He deliberated over the larger issue of defending the northern frontier from Louisiana to the Californias. Alarmed over foreign encroachment into Spanish territory by the Russians, Gálvez began a plan that would colonize Alta California, explore to the Aleutians, and occupy Nootka. As early as 1767, Gálvez planned to establish San Blas as a base for naval operations in the Gulf of California. The port was to support expeditions for both Sonora and Alta California. It was also to support explorations in the Gulf of Alaska.
To revitalize the process of expansion of the northern frontier of New Spain, Gálvez proposed establishment of a General Command of the Interior Provinces. This command was first established in 1776 under El Caballero de Croix, who became the first Captain General of the Provincias Internas.
Gálvez was responsible for the expulsion of the Jesuits in New Spain. He instituted a royal monopoly on tobacco. Through his efforts, trade with Mexico was improved and more revenue found its way into royal coffers. Gálvez submitted the plan for the occupation of Alta California to Fray Junípero Serra, president of the Franciscan missions of Baja California.
After his return to Spain in 1772, Gálvez became the leading spirit of the Council of the Indies, becoming minister general of the Indies in 1775. His influence advanced the fortunes of his brother, Matías de Gálvez, and of his nephew, Bernardo de Gálvez, both of whom became viceroys of New Spain during the 1780s.
In 1779 he founded a colony in the valley of Sonora Mexico, which soon prospered. Gálvez was rewarded for his efforts by being created the Marqués of Sonora.
José de Gálvez died in 1787. Before his death, King Charles III paid a special tribute to him by speaking of the "understanding, experience and zeal of the present Minister of the Indies, with whom I am extremely satisfied".