
In 1973, when the Watergate scandal began brewing, Nixon looked for a loyalist to become chairman of the Republican National Committee and he asked Bush, who accepted, and held this position as the popularity of both Nixon and the Republican Party plummeted. At first Bush was a steadfast defender of Nixon, but as Nixon's complicity became clear, Bush realized that his first obligation was to defend the Republican Party, while still maintaining friendly to Nixon. It was in his capacity as party chairman that Bush formally requested that Nixon eventually resign the Presidency for the good of the Republican party and the nation. Nixon resigned on August 9, 1974. Bush wrote in his diary:
"There was an aura of sadness, like somebody died. The [resignation] speech was vintage Nixon—a kick or two at the press — enormous strains. One couldn't help but look at the family and the whole thing and think of his accomplishments and then think of the shame."
Nixon's successor Gerald Ford appointed Bush to the position of Chief of the U.S. Liaison Office in the People's Republic of China. At the time the United States maintained official relations with the Republic of China on Taiwan and not the People's Republic of China, so the Liaison Office did not have the official status of an embassy and Bush did not formally hold the position of "ambassador", though he unofficially performed the duties as one. He held that position for 14 months, and was praised for advancing relations between the two nations.
Bush was under serious consideration for being nominated as Vice President, and Ford narrowed his list to Nelson Rockefeller and Bush. White House Chief of Staff Donald Rumsfeld reportedly preferred Rockefeller over Bush, and Rockefeller was who Ford ultimately selected. Bush was passed over for the vice presidency by Ford a second time when the president chose Bush's future presidential rival, Senator Bob Dole, to replace Rockefeller on the 1976 presidential ticket. This was seen as a concession to the party's conservative wing.
In 1976 Ford brought Bush back to Washington to become Director of Central Intelligence (DCI), replacing William Colby. Bush served in this role for 357 days, from January 30, 1976, to January 20, 1977. The CIA had been rocked by a series of scandals, including findings by the Church Committee regarding illegal and unauthorized activities by the CIA. Bush was credited with helping to restore the agency's morale. In his capacity as DCI, Bush gave national security briefings to Jimmy Carter both as a Presidential candidate and as President-elect. Carter briefly considered the possibility of remaining in the position in a Carter administration, but ultimately Carter decided against doing so. Bush was succeeded by Deputy Director of Central Intelligence E. Henry Knoche, who served as acting Director of Central Intelligence until Admiral Stansfield Turner was confirmed by the senate for the position.

After a Democratic administration took power in 1977, Bush became chairman on the Executive Committee of the First International Bank in Houston. He later spent a year as a part-time professor of Administrative Science at Rice University's Jones School of Business when the school opened in 1978. Between 1977 and 1979, he was a director of the Council on Foreign Relations foreign policy organization. He left to mount his first campaign for the Presidency.