On the 1st of July the regiment had another opportunity of signalizing itself in conflict. A strong body of French cavalry having succeeded in driving in the Spanish out-posts, was threatening the safety of the British camp at Albuhera, which was covered by the THIRD DRAGOON GUARDS, when a picquet of about twenty men of the regiment, under the command of Captain E. R. Story, who perceived the extreme danger of the camp and the necessity of a check, stood the charge of the French squadrons; and having ultimately received a reinforcement of a squadron of the regiment, under Captain Watts, repulsed the attack, charged in turn, and finally compelled the enemy to retreat, recovering, at the same time, the prisoners which the French had taken in the first onset. On this occasion Lieutenant Ellis, one serjeant, one trumpeter, and two private men of the picquet, were killed; and Captain Watts, whose squadron reinforced the picquet, was wounded. This important and valuable service, performed at so critical a moment, occasioned an order for every man of the THIRD DRAGOON GUARDS to be supplied with an extra ration of rum; and the following brigade order was published on the same day. 'Major-General Slade is most happy in the opportunity which the Third Dragoon Guards have afforded him of thanking them for the gallantry and steadiness with which they repulsed an attack made by the enemy's cavalry this afternoon; particularly the picquet under the command of Captain E. R. Story, and the supporting squadron, commanded by Captain Watts. He requests those officers, with the officers and men under their command, will be pleased to accept his grateful acknowledgments. 'The Major-General particularly regrets the loss of Lieutenant Ellis, who nobly fell at the head of his men: he has also to lament Captain Watts being wounded, but he hopes not dangerously so, and that the regiment will not be deprived of his services long.' The camp at Albuhera broke up on the following day, and the troops advanced upon the enemy, who retired upon Cordova. The THIRD DRAGOON GUARDS proceeded by Los Santos to Llerena; and occupied Fuente del Mastre on the 24th of July, on which day they were suddenly called upon to make a flank movement with the view of gaining the rear of two regiments of French dragoons and one of chasseurs, who had driven in the Portuguese picquet, and were advancing upon _Villa Franca_. The regiment passed through Los Santos, and, advancing at a quick pace, soon reached Hinojosa; but the French had made a precipitate retreat, and had quitted the town a short period before the Dragoon Guards arrived.