Returning to Egypt via Lemnos, the battalion undertook Canal Zone defensive duties and further training. During this time the AIF underwent a period of reorganisation while its future employment on operations was decided. A number of units from the 1st Division were split up and used to provide cadre staff for newly formed battalions, however, the 21st Battalion, like the rest of those from the 2nd Division remained intact. In mid-1916, the decision was made to transfer part of the AIF to Europe to take part in the fighting along the Western Front, and in March 1916 the battalion arrived in France. In April, they became the first Australian battalion to "commence active operations on the Western Front". In July 1916, during the Battle of Pozières, the battalion was committed to the battle, but was mainly used to carry out portage tasks. Later, in August, during the fighting around Mouquet Farm, the 21st Battalion suffered its most significant losses of the war.