He was then sent to Libya with the 26th Infantry Regiment, and on 16 May 1913 he distinguished himself in combat at Sidi Garbaa (south of Derna), being awarded the Silver Medal of Military Valor.

Under his command the "Pistoia" was transferred to Greece and then, after having been reorganized as an AS-type auto-transportable infantry division, to Egypt in September 1942.

[5][7][8] Kept in reserve during the second battle of El Alamein, as it was deemed not yet combat ready, the Division was attacked by the advancing Eighth Army on 11 November and forced to retreat to Tripolitania and then to Tunisia along with the rest of Panzer Army Africa.

Falugi commanded the Division throughout the Tunisian campaign, participating in the battles of the Mareth Line, of Wadi Akarit and of Enfidaville.

He was promoted to major general for war merit on 26 April 1943 and captured by the British with the final surrender of all Axis forces in Tunisia, on 13 May 1943.