After Britain's declaration of war against Germany, Callaghan joined the Australian Imperial Force (AIF) and was shipped to the Middle East with the 2nd Battery of the 1st Field Artillery Brigade. He participated in the Gallipoli landings on 25 April 1915. He was awarded the Distinguished Service Order for his actions in July, when he advanced with infantry to Turkish trenches from where he dispatched reports back to his battery. He was evacuated in December 1915, with the rest of the Australian and New Zealand Army Corps, from Gallipoli to Egypt and transferred to the 5th Divisional Artillery. In March 1916, he was made commander of the 25th Howitzer Battery and promoted to major.