In 1870, during the Franco-Prussian War, Failly commanded the 5th Corps. His inactivity at Bitche on 6 August while the 1st Corps on his right and the 2nd Corps on his left were crushed at the battles of Wörth and Spicheren respectively, gave rise to the greatest indignation in France. Failly then commanded the right wing of Marshal de Mac-Mahon's "Army of Châlons" during the Sedan campaign, and the disastrous outcome of that campaign is partly ascribed to Failly's tactics, though he is certainly no more to blame than the other French generals. Failly and his 5th Corps were routed at Beaumont on 30 August 1870 by two corps led by George of Saxony. In this battle the French were surprised in their cantonments and driven back upon Mouzon. The defeat closed the southern escape route and forced the French "Army of Châlons" towards the Belgian frontier and encirclement at Sedan. He was captured by the Prussians at Sedan on 2 September, but was liberated some months later.