He was again appointed as Military Secretary to Lord Roberts, now Commander-in-Chief in South Africa, on 23 December 1899 during the Second Boer War, and was granted the local rank of major-general. He went on to be Director of Transport on 18 February 1900. Nicholson was mentioned in Lord Roberts' despatch dated 31 March 1900: in this despatch Lord Roberts wrote, "...Colonel Sir W. Nicholson (local Major-Gen.), R.E., undertook, at my request, organisation of a transport department in the limited time available; he performed this duty with conspicuous ability." He was present at the Battle of Paardeberg and at the actions at Poplar Grove, Driefontein, Vet and Zand Rivers, and in operations near Johannesburg, Pretoria and Diamond Hill, and in the operations in the Transvaal, east of Pretoria, during the latter half of 1900. In the South African honours list published in April 1901, he was promoted to the substative rank of major-general for distinguished service in the field, dated 23 December 1899 (the date he was granted that rank locally in South Africa).