The 1979-80 season was the first time in twenty years the League of Ireland had been won by Limerick. Under the leadership of Eoin Hand they fought a highly competitive campaign, being chased all the way by Dundalk and Athlone culminating in a terrific match in Athlone. It was the beginning of a successful three year period of qualifying for European football.A European Cup home match between Limerick and Real Madrid took place in Lansdowne Road on 17 September 1980. The decision was taken to play in Lansdowne rather then Limerick to avail of larger crowd capacity but financially it ended in disaster. It was a great game with difficulty in determining between the Limerick part-timers and the professional Spanish football team. Although Limerick lost they were the better team.
It was unfortunate that Johnny Matthew’s goal was disallowed for offside and that Des Kennedy gave Limerick the deserved lead only for the referee to award a disputed penalty to the Spaniards. The final result was a win for Real Madrid 2-1. Two weeks later Limerick traveled to Spain to play in the Bernabeu Stadium in front of 60,000 fans. Real Madrid were comfortable 5-1 winners. The 1980-81 season saw Limerick finish ten points behind Athlone and runners-up in the league, which qualified them for the Union of European Football Associations (UEFA) Cup. The draw pitted them against Southampton.

The 1981 –82 season, still under the leadership of Eoin Hand, saw the return of Al Finucane from Waterford and the introduction of Tony Ward. Limerick had qualified for the UEFA Cup against Southampton but they were beaten 3-0 in the Markets Field. The return match at the Dell saw Limerick draw 1-1 with Southampton who had Kevin Keegan on their team. During this visit to Southampton, Tony Ward was offered a professional contract to play with Southampton, which he declined. Limerick finished the 1981-82 season by winning the FAI Cup when they defeated Bohemians in the final at Dalymount Park. This marked Kevin Fitzpatrick’s final game in goal. He had played twenty-two years for Limerick.

In the 1982-83 season the team’s next European campaign was against AZ67 of Holland, which saw Limerick go out 2-1 on aggregate and eighth place on the League of Ireland table

The 1983-84 season started in the High Court with a battle for ownership of the Limerick senior football team. Before Pat Grace took over the Limerick soccer team they were known as Limerick United. He changed the name to Limerick City. A group led by Michael Webb wanted the Limerick team to retain the name Limerick United and to stay in the Markets Field. Soccer was suspended in Limerick for eight weeks whilst a decision was made in the High Court. The decision went in favour of Limerick City and they continued to play in the Markets Field until the end of the season when they moved to Rathbane. Limerick City ended the season winning the Shield, which had been revived that year

In 1985 the League of Ireland divided into two divisions the premier division and the first division. Limerick County would have two senior soccer teams in the league – Limerick City in the premiere division and Newcastle West United in the first division.

Soccer history was made in February 1987 with the first all-Limerick FAI Cup clash. Billy Hamilton, a noted Northern Ireland international player, had become Limerick’s player-manager and played in the Newcastle West match. Over 2,000 supporters attended the game, which was won by Limerick 4-0. Through time, the move to Rathbane proved unpopular. The fans were not prepared to travel and resented the move from the Markets Field, which they called the spiritual home of Limerick soccer. Due to the lack of support, the club’s finances were in a bad state. Limerick City’s only success in 1987 was the avoidance of relegation.

Limerick played Oxford United in a preseason friendly in August 1988, the result being 2-1 in favor of Oxford United. In October 1988 Limerick won their first piece of silverware in Rathbane beating Cork City 1-0 in the Munster Senior Cup Final.

In September 1989 Billy Hamilton resigned as Limerick City’s manager. After his departure the team reverted back to the name, Limerick FC and club colours returned to blue. Pat Grace, the chairman, departed and Father Joe Young became the new chairman.