The Libertines were almost instantly hailed by critics as the best new thing in British music, and their kind of lyrics-first approach would later inspire acts like the Arctic Monkeys and the View. Despite the success of the Libertines, however, Doherty was just getting into his impressive drug habit (he later admitted addiction to both crack and heroin), which caused him to miss many of the group's shows. He made headlines in 2003 when, after Barat had asked the troubled frontman to take a break from the Libertines, he broke into his bandmate's apartment, an act which later sent him to jail for a month. Once released, however, the two made up, immediately playing a show together and planning for the Libertines' future. But all was not well with the singer and, still addicted to drugs, he entered a rehabilitation clinic in rural Thailand, where he stayed three days until escaping for Bangkok and eventually making his way back to England. At this point, he was estranged from his band, though they insisted they would welcome him back once he had cleaned himself up.

It was around this same time that Doherty began to explore other musical options, playing solo gigs (allegedly for drug money) and also forming another band, Babyshambles, with guitarist Patrick Walden, bassist Drew McConnell, and drummer Gemma Clarke. The Libertines released their self-titled sophomore record in August 2004, but despite the critical praise it received, at this point they were all but defunct. Doherty's drug habit kept him in constant legal trouble, and his occasional efforts to stop never worked. However, his passion for music (and ability to make it) continued, and in August 2005 Babyshambles released the single "Fuck Forever" in anticipation for autumn's full-length, Down in Albion, which, although messy and unfinished-seeming, still showed promise of the brilliance Doherty could deliver. The following year Babyshambles, after some lineup changes, signed to Parlophone Records, which issued the Blinding EP in 2006. Doherty, of course, was still in and out of trouble and rehab, making tabloid headlines not only for his drug battles but also for his relationship with model Kate Moss, whom he had been dating (with some breaks) since 2005, and whom he would even claim he would marry. In April 2007, he reunited with Barat for a show, though no plans for a Libertines reunion were officially made. After Babyshambles' 2007 album Shotter's Nation, the band went on hiatus and Doherty recorded a solo album with Shotter's Nation producer Stephen Streetand Blur guitarist Graham Coxon. Grace/Wastelands, which was billed to Peter Doherty, was released early in 2009 shortly after his 30th birthday.