Lyallpuri played a key role in the development of the Shiromani Akali Dal and in the Gurdwara Reform Movement of the early 1920s.
Lyallpuri was invited for a personal interview for the position of tehsildar (revenue officer), but he sat in a chair in front of the Commissioner without his permission.
It was a time when the Hindu Arya Samaj movement was ruling supreme in Punjab, and the Sikh masses were coming to its fold in large numbers.
It was this association that started the Gurdwara Rikabganj Morcha, later supported by the broad Sikh community, and won the victory for the Akalis.
He decided to create a weekly newspaper, the Sacha Dhandora, and began publishing patriotic songs and Sikh-ideology related nationalistic articles.
The write-ups in The Akali, published by Lyallpuri, played a very important and effective role in electrifying the Sikh community and rousing it into action for Gurdwara Rakabganj Morcha.
In several of the schools he had founded and served, he offered his services free in exchange for only two meals and a pair of personal clothes.
In the early morning of April 22, English police fully loaded with machine-guns laid siege to Lyallpur[4] and arrested 12 people including Lyallpuri.
However, the nationalist lawyers continued to pursue the case and finally the sentence was reduced to a fine of Rs 1200 and imprisonment of 1.5 years, for which he was deported to Cellular Jail, Andaman and Nicobar Islands.
It was the first Punjabi daily to be published and in its very first issue, it had outlined in its editorial note its programme advocating: (1) Panthic control over the Gurdwaras; (2) Panthic control of Khalsa College, Amritsar; (3) repairing the demolished wall of Gurudwara Rakabganj, Delhi; (4) creation of religious and political awakening among the Sikh masses and to line them up for more effective roles in India's struggle of independence; and (5) creation of a Sikh organisation and choosing its members democratically through elections based on Panchayat rules.
[9] The writings in The Akali were so effective and bold compared to the Urdu dailies of the times that some Hindus and even Muslims had especially learnt Gurmukhi to read The Akali[10] The paper effectively and forcefully raised the wall issue of Gurdwara Rakabganj Delhi and roused the Sikh community into dynamic action and participation.
[12] After awakening and organising the Sikh community and achieving a first phase of success in the domain of religion and education, The Akali started dedicating its columns to India's freedom struggle.
The paper had realistically adopted a nationalistic approach and had also offered a powerful common front against the anti-Indian, anti-communal and pro-imperialist forces.
[14] At the national level, the Na Milwartan Lehir (Non-Cooperation Movement) was so effectively projected in the daily The Akali that it caused a great alarm and concern among the English Government and they had to arrest Lyallpuri and later other 10-12 of its editors, one after another, within two years.
He had suggested to Master Lyallpuri that Akali should start one of their own English newspaper so that the Akal agenda and voice could reach every nook and corner of India.
However, the move received a setback when Lyallpuri was arrested under section 124 'O' for writing what the English Government thought was objectionable material in The Akali.
On release from jail, Lyallpuri resumed the efforts and put an advertisement in The Akali asking for donations for five Lakhs from Sikh Sangat.
It was very unfortunate for the Sikhs that due to lack of experience, and jealousy and betrayal of the fellows like Master Tara Singh and S. Mangal Singh Gill, as well as due to lack of viable financial resources, the Hindustan Times soon came into severe grip of financial crisis so that its ownership had to be sold to Pt Madan Mohan Malayia.
They rather gave it a communal twist, so the Akalis had to part company with Hindustan Times; and this also caused winding up of the Sikh Center at Delhi which I had established with so much fondness and hard labour.
"[16] Hindustan Times which was founded by Master Sunder Singh Lyallpuri and friends and later sold out by Akalis now forms one of the most leading groups of Indian dailies and is published from several places, besides Delhi.
With Mahatma Gandhi as its chairman and Convener, the National Panchayat included, among others, Lala Lajpat Rai, G. K. Nariman, Master Sunder Singh Lyallpuri, Dr S. K. Datta and Hakim Ajmal Khan.
[17] In the following years, Master Lyallpuri organised or else participated in several seminars or Ekta Samelans for the promotion of mutual love, trust and brotherhood among the Hindus, Muslims, Christians, and the Sikhs.
At the proposal of Baba Kharak Singh and Lyallpuri, a resolution was included in the Congress Session asking for Complete Independence of India.
When S. Paratap Singh Kairon became Chief Minister of Punjab, he allotted him 12 acres (49,000 m2) of land and a sustenance pension of Rs 100 per month.