Having developed an interest in archeological geology, Alvarez left the oil company and lived in Italy, studying the Roman volcanic rocks and their influence on patterns of settlement in early Roman times. He then moved to Lamont-Doherty Geological Observatory of Columbia University, one of the centers where the plate-tectonic revolution was unfolding.
His work on tectonic paleomagnetism demonstrated that very small plates in the Mediterranean, Corsica-Sardinia for example, have moved around. That led to a study of the reversals of the Earth's magnetic field recorded in deep-sea limestones. At Gubbio, in Italy, Alvarez and his colleagues were able to date the geomagnetic reversal sequence on the basis of foraminiferal biostratigraphy through an interval of more than 100 million years of Earth history, providing a new tool for dating sedimentary rocks.
In 1977 he joined the faculty at U.C. Berkeley and began a study of the mass extinction at the end of the Cretaceous Period as recorded in the Italian limestones. Evidence from iridium measurements suggested that the extinction was due to impact on the Earth of a giant asteroid or comet, and many years later that hypothesis was confirmed by the discovery of the largest impact crater on the planet, in the subsurface of the Yucatán Peninsula, dating from precisely the time of the Cretaceous-Tertiary extinction.
From 1994 to 1997 Alvarez was Chairman of the Department of Geology and Geophysics, and then returned to teaching and to research centered on Mediterranean tectonics, impact events, and Earth history as recorded in the beautifully exposed sedimentary rocks of the Colorado Plateau and in the deep-water limestones of Italy. He is currently interested in Big History, the emerging interdisciplinary field that aims to tie everything in our planet's past — its cosmic ancestry, its geological and paleontological evolution, and the pageant of human societies — into a coherent understanding of the grand sweep and character of history.
Alvarez is a recipient of the Penrose Medal (the highest honor of the Geological Society of America) and the Vetlesen prize, is a member of the National Academy of Sciences, is an honorary citizen of two Italian towns — Piobbico and Gubbio — and has received honorary doctorates from the University of Siena in Italy and the University of Oviedo in the Principality of Asturias in Spain, where his family originates.