Between 1983 and 1987, mercenaries adopting the pseudonym GAL (Grupos Antiterroristas de Liberación, Antiterrorist Liberation Group) paid by the Spanish treasury and relying upon national intelligence support were at war with the Basque militant group ETA (Euskadi (e)Ta Askatasuna, Basque Country and Freedom). Over four years, their campaign of extrajudicial assassinations spanned the French-Spanish border. Nearly thirty people were killed in a campaign comprised of torture, kidnapping, bombing and the assassination of suspected ETA activists and Basque refugees. This establishment of unofficial counterterrorist squads by a Spanish Government was a blatant detour from legality. It was also a rare case in Europe where no less than fourteen high-ranking Spanish police officers and senior government officials, including the Minister of Interior himself, were eventually arrested and condemned for counter-terrorism wrongdoings and illiberal practices. Thirty years later, this campaign of intimidation, coercion and targeted killings continues to grip Spain. The GAL affair was not only a serious example of a major departure from accepted liberal democratic constitutional principles of law and order, but also a brutal campaign that postponed by decades the possibility of a political solution for the Basque conflict. Counter-terror by proxy uncovers why and how a democratic government in a liberal society turned to a 'dirty war' and went down the route of illegal and extrajudicial killing actions. It offers a fuller examination of the long-term implications of the use of unorthodox counter-terrorist strategies in a liberal democracy.