On John Macarthur's death in April 1834, James and one of his brothers, William, were bequeathed Camden Park Estate as tenants in common.

Consequently, after his father's insanity and death, he became the colony's leading Exclusive and was trenchant in his opposition to the granting of civil rights to Emancipists.

Macarthur also proposed government subsidies for 'respectable' British immigrants and disparaged the principles of squatting while supporting the continued granting of freehold on crown land to the wealthy and respectable elite of the colony.

After initially opposing the granting of representative self-government to the colony he gave it his approval when it appeared to be inevitable and any further resistance had the potential to diminish his influence in a popularly elected parliament.

The constitution granted to the colony in 1856 was seen by Macarthur as a dangerous experiment in liberalism and, after unsuccessfully attempting to influence the new parliament, he became disillusioned and retired to England in 1859.

Despite being one of the leading men of the colony between 1820 and 1856, Macarthur considered his political career to be a failure because most of his conservative policies were overturned as a liberal form of democracy developed in Australia.