In 1861, Seward became Secretary of State under Abraham Lincoln, and many expected him to be the real power in the administration. He revealed his own desire to dominate the President in a peculiar memorandum (Apr. 1, 1861) to Lincoln in which he proposed waging war against most of Europe so as to unite the nation. Seward also did some unwarranted meddling during the Fort Sumter crisis. After the Civil War broke out, however, he showed himself an able statesman, although it took all of Lincoln's ingenuity to keep both Seward and his rival, Salmon P. Chase, eternally ambitious for the presidency, in the same cabinet. Seward's handling of delicate matters of diplomacy with Great Britain, particularly in the Trent Affair, was notably adept. He also protested French intervention in Mexico and after the Civil War helped bring an end to it.
The plot of John Wilkes Booth to assassinate Lincoln also included a stabbing attack on Seward, but he recovered from his wounds and retained his cabinet position under the new President, Andrew Johnson. He supported Johnson's Reconstruction policy and, like the President, was roundly denounced by the radical Republicans. Seward's most important act in this administration was the purchase of Alaska from Russia in 1867. His foresight was not generally acknowledged, however, and Alaska was long popularly called "Seward's folly." He also tried to purchase the two most important islands in the Danish West Indies (the Virgin Islands), but the Senate refused to approve his action.