The Americal was reactivated 25 September 1967 at Chu Lai in Vietnam from a combination of units already in Vietnam and newly arrived units. Its precursor, a division-sized task force known as Task Force Oregon was created in Quảng Ngãi and Quảng Tín provinces from the 3rd Brigade of the 25th Infantry Division, the 1st Brigade of the 101st Airborne Division, and the 196th Light Infantry Brigade (all separate brigades that deployed to Vietnam in 1966). Task Force Oregon operated in close cooperation with the 1st Marine Division in the I Corps Military Region. As more US Army units arrived in Vietnam the two divisional brigades were released back to their parent organizations and two arriving separate brigades were assigned to Task Force Oregon, which was in turn re-designated the 23rd Infantry Division (Americal). The division was composed of the 11th, 196th, and 198th Light Infantry Brigades and divisional support units. Both the 11th and 198th brigades were newly formed units.

The Americal, in Vietnam, suffered an important defeat at the Battle of Kham Duc but gave a solid performance during the Tet Offensive, The Battle of LoGiang and the Battle of Nui Hoac Ridge (Hill 352). Platoon Sergeant Finnis McCleery was awarded the Medal of Honor for his valiant efforts on Hill 352. Sgt. Alan Allen was awarded the Silver Star for this same battle. Both men were members of A Co. 1/6 198th. 20 men from A Company were lost in the Battle of LoGiang on 8 February 1968. A Co. of the 198th was awarded the Presidential Unit Citation for its heroic efforts in the Battle of LoGiang, 8 February 1968.^[10

^]The Americal Division became notorious after a platoon of troops from the division led by Lieutenant William Calley slaughtered hundreds of South Vietnamese civilians in the My Lai Massacre in March 1968.^[11] A helicopter crew from the division's 123rd Aviation Battalion, led by Hugh Thompson, Jr., attempted to intervene in the massacre and were later awarded the Soldier's Medal.^[12] Seymour Hersh broke the story of the massacre in November 1969, and a year later 14 officers – including Samuel W. Koster, the division's commanding officer – were charged with covering the massacre up. Most of the charges were later dropped, but Koster was subsequently demoted and stripped of his Distinguished Service Medal.^[13]