Following Italy's entry into the war on 10 June 1940, Waller was involved in the search for minefields off the North African coast. A keen shooter, he personally blew up floating mines using a rifle and armour-piercing bullets. On 21 June, "Stuart" shelled the Italian-held town of Bardia. The next month, his 10th Destroyer Flotilla participated in the Battle of Calabria. Waller's ships carried out bombardments on Fort Capuzzo on 17 August and an Italian seaplane base in the Gulf of Bomba one week later. In September, he was awarded the Distinguished Service Order (DSO) for "courage, enterprise, and devotion to duty on recent engagements"—in particular, his pinpointing of enemy minefields. The same month, he transferred to HMAS "Vampire" while "Stuart" went in for refit. As the Allied armies began to counterattack Italian forces in December 1940, the Commander-in-Chief of the Mediterranean Fleet, Admiral Sir Andrew Cunningham, gave Waller command of the newly formed Inshore Squadron, comprising destroyers, minesweepers, and auxiliaries. In his role as Cunningham's Senior Officer Afloat, Waller took charge of naval support for the attack on Bardia, which fell to the Allies on 5 January 1941. Shortly afterwards, he handed over command of the Inshore Squadron and transferred back aboard "Stuart".