Smith entered the Union Army on September 9, 1861, as a lieutenant colonel. Later in the year, he was commissioned as the colonel of the newly raised 54th Ohio Infantry. He organized the regiment at Camp Dennison near Cincinnatiin the summer and fall of 1861. In February 1862, Smith and his men were ordered to Paducah, Kentucky, where they joined the division of Maj. Gen. William T. Sherman. He was conspicuous in the Battle of Shiloh, on April 6 and 7, 1862, assuming command of Stuart's Brigade, Sherman's Division, during the second day. As commander of a brigade in the XV and then in the XVII Army Corps, he participated in all the campaigns of the Army of the Tennessee; being also for some months on staff duty with General Ulysses S. Grant. He was commissioned as a brigadier general of volunteers on August 11, 1863. Smith was assigned on March 7, 1864, to the command of the detached division of the XVII Army Corps and rendered distinguished service during the Red River Expedition, protecting Admiral David D. Porter's fleet after the disaster of the main army. During the Red River campaign, he ordered the destruction of the library and other items at Louisiana State University, but the building was spared at the request of Maj. Gen. William T. Sherman, the school's first superintendent. His health failed, and Smith was relieved of field duty on January 17, 1865. After the fall of Mobile, Alabama, he assumed the command of the Department of Southern Alabama and Florida, and then of the Post and District of Maine. He was brevetted as a major general for gallant and meritorious service.
Postbellum career
After the war he removed to Torresdale, Philadelphia. In 1866 President Andrew Johnson appointed him as the United States Consul at Panama. He inventoried Julius H .Kruehl's personal belongings when he died presumably by the bends in Panama. At the time of his death, he was engaged in journalism in New York City. On May 2, 1848, he married Elizabeth Budd, daughter of Dr. William Budd McCullough and Arabella Sanders Piatt, of Cincinnati. She was a gifted and devout woman, and through her influence and that of the venerable archbishop Purcell he became a Catholic some years before his death. He left five sons and three daughters. Smith is buried in Saint Dominic Church Cemetery in Torresdale, Philadelphia. In 1911, a bronze bust of Smith by sculptor Louis Milione was dedicated in Vicksburg National Military Park. Smith's sons paid for the plaque and donated it to the park.
The monument is located in the Vicksburg National Military Park on Union Avenue approximately 150 yards south of Grant Avenue. Also a marker designating the assaults of May 19, 1863 located on the ridge on the south side of Graveyard Road 400' east of the Stockade Redan. This unit was attached to Col. Thomas Kilby Smith and Brig. Gen. Joseph Andrew Jackson Lightburn's 2nd Brigade of Maj. Gen.Francis P. Blair's 2nd Division, Maj. Gen. William T. Sherman's XV Army Corps and was commanded by Lt. Col. Cyrus W. Fisher.