2007–2010: Famous Last Words and The Show Must Go
The group began working on their second studio album in May 2007, with producers Dave Genn and Greig Nori. The group recorded the album in Hipposonic Studios in Vancouver, British Columbia and in Rock Beach Recording in White Rock, British Columbia. Hoggard described the process as "lengthy" and said this time around, they wanted to showcase a lot of maturity on the record and as a result, "have learned the value of patience." They released their second studio album, Famous Last Words, on October 30, 2007, and it went platinum in Canada ten days later. The album peaked at number three on the Canadian Albums Chart, as well as reaching number one on the Canadian Alternative Albums chart. The first single from the album, "She's So Sorry", was released to radio on August 21, 2007, and had its music video premiere on MuchMusic on September 20, 2007. "For the Nights I Can't Remember" was released in November 2007, as the second single. The song peaked at number six on the Canadian Hot 100. The song topped the Canada Hot AC charts for eight weeks. The song won three MuchMusic Video Awards in 2008. In late 2007, the band opened for Bon Jovi on their Lost Highway Tour at their Canadian stops for 14 shows, forcing them to postpone their own tour until early 2008, opened by State of Shock. "Never Too Late" was released in April 2008, as the third single. The song reached number four on the Canadian Hot 100. "Old School" was released as the album's fourth single in August 2008, and reached number ten on the Canadian Hot 100. "Dying to Live Again" was released in November 2008, as the fifth single, peaking at number 59 on the Canadian Hot 100.
In the United States, the group released Famous Last Words as Never Too Late on May 12, 2009, by Fontana Distribution, at the time owned by Hedley's Canadian record label's parent company Universal Music. The album includes eight tracks from the Canadian release and five tracks from their first album.
Working with producers David Bendeth, John Feldmann, Dave Genn and Brian Howes, Hoggard began writing songs for their third album as the band was wrapping up their Famous Last Words tour. Over the course of three months, 45 songs were written, inspired from "the collapse of several relationships — both romantic and platonic," according to Hoggard. On August 17, 2009, the group released "Cha-Ching" as the first single from their third album. It peaked at number six on the Canadian Hot 100. The second single, "Don't Talk to Strangers" was released on October 27, 2009. It peaked at number 11 on the Canadian Hot 100. On November 17, 2009, Hedley released their third studio album, The Show Must Go. The album peaked at number six on the Canadian Albums Chart and was certified double platinum in Canada. The album earned a Juno award nomination for Pop Album of the Year in 2010. The band was also nominated for Group of the Year. The third single, "Perfect", released on February 8, 2010, peaked at number seven on the Canadian Hot 100. The song reached number 25 on the US Adult Top 40 chart, marking the group's first charting song in the US. The song was nominated for Single of the Year and won Video of the Year at the 2011 Juno Awards. The fourth single off the album, "Hands Up", reached number 27 on the Canadian Hot 100. "Sweater Song" was released as the fifth single and peaked at number 63 on the Canadian Hot 100. The band went on The Show Must Go... on the Road Tour across 38 cities in Canada with supporting acts Fefe Dobson, Stereos, Faber Drive and Boys Like Girls. A live album and documentary, Go with the Show, was recorded during this tour and was released on November 9, 2010. The Show Must Go was nominated for Album of the Year at the 2011 Juno Awards.
In 2010, the band signed an American record deal with Island Records. The album was originally to be released in the US on October 12, but instead was released on December 7, 2010, containing the bonus tracks "I Do (Wanna Love You)" (a re-arrangement of the song "For the Nights I Can't Remember" and "Color Outside The Lines". The band also toured the US to promote the album. The band performed "Cha-Ching" in a segment with other artists highlighting Canadian music at the closing ceremony of the Vancouver 2010 Winter Olympic Games.