Reed and Slick signed with the WWF and were brought in as a package. Reed dyed his hair blond and became "The Natural" Butch Reed. He feuded initially with Tito Santana, a target of Slick's verbal jabs, and made his pay-per-view debut at WrestleMania III, where he defeated Koko B. Ware.
In the weeks after WrestleMania, Reed targeted new Intercontinental champion Ricky Steamboat and faced him at house shows and on an episode of Wrestling Challenge. According to a persistent myth, Reed no-showed a set of TV tapings where he was booked to win the title, resulting in the championship instead being put on The Honky Tonk Man.
In the fall, the WWF was heavily hyping a feud between Reed and "Superstar" Billy Graham, a former WWF champion who was staging a comeback after hip-replacement surgery. However, Graham's condition was such that he could no longer handle the physical demands of being a wrestler, so Reed and Slick's newest acquisition, the One Man Gang, "injured" Graham in a sneak attack that was used to explain his permanent retirement. Graham began managing the man who came to his aid, Don Muraco, with Muraco immediately entering into a rivalry with Reed. The enemies were on opposing teams in the main event of the first Survivor Series (Muraco took Graham's place on Hulk Hogan's team); Reed (a member of André the Giant's team), was the first elimination of the match, by Hogan.
Reed competed in (and was the first wrestler eliminated from) the first Royal Rumble match in January 1988. Two months later, he was eliminated in the first round of the WrestleMania IV championship tournament by eventual tournament winner "Macho Man" Randy Savage.
On September 9, 2007, he made a cameo appearance backstage at the September 14 WWE SmackDown! taping during a segment involving his former manager and SmackDown! General Manager Theodore Long.