It took a few seasons of setbacks and minor league training, but Smith emerged as a solid player by the end of the decade. Playing on a line with Danny Gare and Tony McKegney, he put together back to back seasons exceeding 20 goals and averaging 64 points.
Smith was part of one of the biggest trades in Sabres history when Buffalo traded Smith, Danny Gare and Jim Schoenfeld to Detroit in exchange for Mike Foligno, Dale McCourt and Brent Peterson on December 2, 1981.
Smith never really found his game in Detroit. After two very quiet seasons with the Red Wings Derek Smith retired in 1984. In 335 NHL games player Smith scored 78 goals, 116 points for 194 points. He played very politely, picking up only 60 minutes in penalties.