Following Lae, the 9th Division was tasked to seize Finschhafen, clear the Huon Peninsula and gain control of the Vitiaz Strait. By 2 October, one of the division's brigades had gained a foothold on Finschhafen, but soon encountered fierce Japanese resistance. In response to a Japanese counter-attack, the 26th Brigade was transferred to reinforce the Australian position on 20 October and, when the division switched to the offensive in November, the brigade was ordered to capture Sattelberg. Sattelberg was a densely wooded hill rising 1,000 metres (1,100 yd) and dominating the Finschhafen region; it was in an assault on this position that Derrick was to earn the Victoria Cross.
The Australian attack on Sattelberg began in mid-November, with the Japanese slowly giving ground and withdrawing back up the precipitous slopes. Each side suffered heavy casualties, and on 20 November, Derrick—who had been acting as company sergeant major for the previous month—was given command of B Company's 11 platoon after the unit had "lost all but one of their leaders". By 22 November, the 2/23rd and 2/48th Battalions had reached the southern slopes of Sattelberg, holding a position approximately 600 metres (660 yd) from the summit. A landslide had blocked the only road, so the final assault was made by infantry alone, without supporting tanks.
On 24 November, the 2/48th Battalion's B Company was ordered to outflank a strong Japanese position sited on a cliff face, prior to attacking a feature 140 metres (150 yd) from the Sattelberg township. The nature of the terrain meant that the only possible route was up a slope covered with kunai grass directly beneath the cliffs. Over a period of two hours, the Australians made several attempts to clamber up the slopes to reach their objective, but each time they were repulsed by intense machine gun fire and grenade attacks. As dusk fell, it appeared impossible to reach the objective or even hold the ground already gained, and the company was ordered to withdraw. In response, Derrick replied to his company commander: "Bugger the CO. Just give me twenty more minutes and we'll have this place. Tell him I'm pinned down and can't get out."
Moving forward with his platoon, Derrick attacked a Japanese post that had been holding up the advance. He destroyed the position with grenades and ordered his second section around to the right flank. The section soon came under heavy machine gun and grenade fire from six Japanese posts. Clambering up the cliff face under heavy fire, Derrick held on with one hand while lobbing grenades into the weapon pits with the other, like "a man ... shooting for [a] goal at basketball". Climbing further up the cliff and in full view of the Japanese, Derrick continued to attack the posts with grenades before following up with accurate rifle fire. Within twenty minutes, he had reached the peak and cleared seven posts, while the demoralised Japanese defenders fled from their positions to the buildings of Sattelberg.
Derrick then returned to his platoon, where he gathered his first and third sections in preparation for an assault on the three remaining machine gun posts in the area. Attacking the posts, Derrick personally rushed forward on four separate occasions and threw his grenades at a range of about 7 metres (7.7 yd), before all three were silenced. Derrick's platoon held their position that night, before the 2/48th Battalion moved in to take Sattelberg unopposed the following morning. The battalion commander insisted that Derrick personally hoist the Australian flag over the town; it was raised at 10:00 on 25 November 1943.
The final assault on Sattelberg became known within the 2/48th Battalion as 'Derrick's Show'. Although he was already a celebrity within the 9th Division, the action brought him to wide public attention. On 23 March 1944, the announcement and accompanying citation for Derrick's Victoria Cross appeared in a supplement to the London Gazette. It read:
Government House, Canberra. 23rd March 1944.
The KING has been graciously pleased to approve the award of the VICTORIA CROSS to:-
Sergeant Thomas Currie Derrick, D.C.M., Australian Military Forces.
For most conspicuous courage, outstanding leadership and devotion to duty during the final assault on Sattelberg in November, 1943.
On 24th November, 1943, a company of an Australian Infantry Battalion was ordered to outflank a strong enemy position sited on a precipitous cliff-face and then to attack a feature 150 yards from the township of Sattelberg. Sergeant Derrick was in command of his platoon of the company. Due to the nature of the country, the only possible approach to the town lay through an open kunai patch situated directly beneath the top of the cliffs. Over a period of two hours many attempts were made by our troops to clamber up the slopes to their objective, but on each occasion the enemy prevented success with intense machine-gun fire and grenades.
Shortly before last light it appeared that it would be impossible to reach the objective or even to hold the ground already occupied and the company was ordered to retire. On receipt of this order, Sergeant Derrick, displaying dogged tenacity, requested one last attempt to reach the objective. His request was granted.
Moving ahead of his forward section he personally destroyed, with grenades, an enemy post which had been holding up this section. He then ordered his second section around on the right flank. This section came under heavy fire from light machine-guns and grenades from, six enemy posts. Without regard for personal safety he clambered forward well ahead of the leading men of the section and hurled grenade after grenade, so completely demoralising the enemy that they fled leaving weapons and grenades. By this action alone the company was able to gain its first foothold on the precipitous ground.
Not content with the work already done, he returned to the first section, and together with the third section of his platoon advanced to deal with the three remaining posts in the area. On four separate occasions he dashed forward and threw grenades at a range of six to eight yards until these positions were finally silenced.
In all, Sergeant Derrick had reduced ten enemy posts. From the vital ground he had captured the remainder of the Battalion moved on to capture Sattelberg the following morning.
Undoubtedly Sergeant Derrick's fine leadership and refusal to admit defeat, in the face of a seemingly impossible situation, resulted in the capture of Sattelberg. His outstanding gallantry, thoroughness and devotion to duty were an inspiration not only to his platoon and company but to the whole Battalion.