Brady stuck up the Duke of York Inn, and finding Captain Smith there, knocked him down, having mistaken him for Colonel Balfour. On discovering his mistake the bushranger apologised. He then threatened to shoot Captain White, but on Captain Smith saying that White had a wife and family Brady told the two officers to go away. He "hated soldiers" and did not know what he might do if they stayed.

Colonel Balfour, of the 49th regiment, with a strong party of soldiers, had been beating the bush for some time in hopes of capturing Brady and his gang. A report spread abroad that the gang intended to break open the Launceston gaol and torture and shoot Mr. Jefferies. The threat was treated with derision, but about 10 a.m. a man came into the town and said that the bushrangers had taken possession of Mr. Dry's place, just outside the town. Colonel Balfour, with ten soldiers and some volunteers, started out and a fierce fight took place. Ultimately the bushrangers were driven off, but not before they had secured Mr. Dry's horses. The soldiers followed, and the bushrangers fired from behind the trees. Suddenly a report spread that the attack on Dry's place was a ruse to draw the soldiers from the town, and that a party of bushrangers under Bird and Dunne had gone to attack the gaol. Colonel Balfour sent half his force back to protect the town. The report was found to be partly true. The bushrangers had entered the town and had robbed Mr. Wedge's house, but had not gone to the gaol. At Dr. Priest's house some shots were exchanged, and the doctor was wounded in the knee, but the soldiers coming up at the time the bushrangers made off.

The following day the gang made an attack on the farms of the Messrs. Walker. They burned the wheat-stacks and barns belonging to Mr. Abraham Walker and also those of Mr. Commissary Walker. They had Mr. Dry's two carriage horses, which they had stolen the day before. Brady was wearing Colonel Balfour's cap, which had fallen off in the fight at Launceston. On the next day they burned down the house of Mr. Massey at South Esk, having sent him a letter a day or two before informing him of their intention.

Two of the gang called on Thomas Renton, and shouted for him to come out. On his doing so, they charged him with having attempted to betray them. Renton denied the charge. A wrangle took place, during which one of the bushrangers shot Renton dead. It is highly improbable that Brady was aware of this outrage. He boasted loudly on every available occasion that he never killed a man intentionally, and he is known to have quarrelled with members of his gang who were too ready with their firearms. Thus he drove McCabe out of the gang on account of his brutality, and McCabe was captured and hung shortly afterwards.

The gang held almost complete control over the roads, and resistance was very rarely offered when they ordered a man to "bail up."[27] One of the customs established by the gang was to order their witnesses to remain where they were for half an hour, and the order was rarely disobeyed. Any person who declined to promise to remain was simply tied to a tree and left for any chance passer-by to unloose. In by-roads, or in those cases where the prisoners were marched some distance off the high road into the bush before being plundered, being tied up was a very serious matter. Cases are known to have occurred in which men have remained bound to a tree until they have died of starvation. From this time forward tying up the victims was a common practice with bushrangers, though some like Brady accepted the promise of the victims to remain where they were left for a certain time to allow the bushrangers time to get away.

At length about the middle of 1825 a convict named Cowan or Cohen was permitted to escape from an iron gang with broken fetters on his legs. He was found by some of the gang and was taken to a friendly blacksmith who knocked his irons off for him. He joined the gang and more than once led them into conflicts with the soldiers out of which only the skill and bravery of Brady delivered them. Cowan was no doubt a clever man in his way; he completely hoodwinked Brady and his mates; he fought bravely in their skirmishes with the troops and was always eager in looting houses or other places attacked. He professed to rob "on principle." He is said to have murdered the bushrangers Murphy and Williams while they slept, but there is no proof of this. He betrayed the camp to Lieutenant Williams of the 40th regiment, who was out with a party of soldiers in search of bushrangers. A terrific fight took place in which several were killed on each side; some of the bushrangers were captured while others escaped, but the gang was broken up. Cowan is said to have received a free pardon, several hundreds of pounds reward, and a free passage home for his services.[28]

Brady made his escape in the bush and was followed by Batman and his black trackers. The bushranger had been wounded in the fight and could not travel fast. Batman came up to him in the mountains and called on him to surrender. "Are you an officer?" asked Brady, coolly cocking his gun. "I'm not a soldier," replied Batman, "I'm John Batman. If you raise that gun I'll shoot. There's no chance for you." "You're right," replied Brady, "my time's come. You're a brave man and I yield; but, I'd never give in to a soldier." Brady was taken to the nearest lock-up, where, as it happened, Jefferies, the cannibal, had been lodged some days before, and much to Brady's disgust the two men were conveyed to Hobart Town in the same cart. Brady, however, refused to sit on the same side of the cart as Jefferies, and kept as far from him as possible during the journey.[29]

The trial of Mathew Brady excited great interest. He and his gang had kept the country in a ferment for twenty-two months. Many of his companions had been shot or captured, but the leader had escaped. One of his mates, James Crawford, who had escaped with him from Macquarie Harbour, but who had been shot by the soldiers some time before the break up of the gang, was said to have been a lieutenant in the army.[30] Numerous stories were told to illustrate his reckless bravery, his skill in strategy, or some other trait of his character. On the day of his trial a number of ladies were in the court, and when the verdict of guilty was returned, and the judge put on the black cap, they showed their sympathy by weeping so loudly that the judge had to pause until order was restored, and sentence of death was pronounced amid signs of sorrow by all present.[31]

At the same sessions Jefferies, Hopkins, Bryant, Tilly, McKenny, Brown, Gregory, Hodgetts, and Perry were sentenced to death for bushranging, cattle, horse, and sheep stealing, and for murder. Some of these had been "in the bush" with Brady. The last of the batch was hung on April 29th, 1826, the prisoners being hung two or three at a time at intervals of a few days.

The remnant of the gang under the command of Dunne continued for a time to commit depredations. In one of their journeys they saw a tribe of blacks camped on the other side of the river. Dunne swam across and attacked them. He fought them for some time driving them back until he seized one of the women, when he turned back forcing her to accompany him across the river. He had this black girl with him when an attack was made on Mr. Thomson's house, but she escaped. On the following day two men were quietly driving in a cart along the road when the blacks attacked and speared them, killing one and wounding the other. The blacks went on and burned the hut of Mr. Nicholas. They attacked Mr. Thomson's place, and speared a man named Scott. The woman who had been stolen by Dunne was present urging the blacks on when Scott was killed. The troops were sent out to drive the blacks back, and while so engaged came across the bushrangers and shot Dunne. One or two were captured and hung as related.