Cosgrove retired from active service following the end of his term as Chief of the Defence Force, and subsequently served as leader of a taskforce helping to rebuild communities in Queensland after Cyclone Larry in 2006.

The platoon located an occupied bunker system in an area where, because of the proximity of allied troops, indirect fire support was difficult to obtain.

In spite of this, he led his platoon in an assault on the bunkers without indirect fire support, capturing the system and killing and wounding at least four enemy without sustaining any casualties.

Knowing that the remainder of the section was elsewhere on other tasks, Lieutenant Cosgrove ran to the contact area and personally conducted the fight against the enemy.

[13] Cosgrove came to national fame in 1999 when, as a major general, he led the international forces (INTERFET) in a peacekeeping mission to East Timor.

[17] Following a joint interview with the then Defence Minister Robert Hill, Cosgrove was accused of "playing politics" when he said that, on this occasion, he disagreed with Keelty's point of view.

[19] "In recognition of the important contribution General Cosgrove made to the community of North Queensland following Cyclone Larry", on 11 October 2008, Queensland Premier Anna Bligh announced that a new residential suburb in the Bohle Plains area of Townsville would be named Cosgrove, formerly the site of an Abattoir for the cattle sale yards next to it.

[citation needed] He served as Chancellor of the Australian Catholic University between November 2010[25] and January 2014;[26] and is Honorary Patron of the ACT Veterans Rugby Club[27] and the Rosies Youth Mission.

On 28 January 2014, Prime Minister Tony Abbott announced that Queen Elizabeth II had accepted his advice to appoint General Peter Cosgrove as the next Governor-General of Australia, to succeed Dame Quentin Bryce in late March.

[32] Former headmaster of Waverley College, Ray Paxton, states "In choosing Sir Peter Cosgrove for Governor General, Australia has honoured a remarkable man".

[33] On 16 December 2018, Prime Minister Scott Morrison announced that The Queen had approved the appointment of retired General David Hurley, the current Governor of New South Wales, as the next Governor-General of Australia, commencing in July 2019, and that Cosgrove's term would be extended until that time to ensure smooth transitions following the New South Wales election in March and federal election expected in May 2019.

[35] During the Coronation of Charles III and Camilla, with the Governor-General of Australia and all of the state governors in London, Cosgrove served as the Administrator of the Commonwealth from 30 April to 10 May 2023.