He participated in all major Russian battles of the Napoleonic Wars in 1805-1814. Upon his return from the campaign in northern Germany in 1805, he was named Governor of St. Petersburg. He played a key role in the Battle of Czarnowo on the night and following morning of 23–24 December 1806. In 1811, he inherited the title of Count Osterman from his childless uncle, Ivan Osterman, the last of the Osterman line. During 1812-1814 commanded a corps, and distinguished himself in the Battle of Kulm 29–30 August 1813. He participated in the 1812 campaigns as a Commander of the 4th Army Corps, under the overall command of Johann von Klenau. Osterman-Tolstoy was wounded in the Battle of Bautzen (21–22 May 1813), before fighting at Dresden and at the Battle of Leipzig. His corps defended the gorges in the mountains of Bohemia and captured General Vandamme. During the battle the count lost his left hand, as Emperor Alexander I put it, “by sacrificing his hand he bought us victory”.