While in California Fahey tracked down Bukka White by sending a postcard to his home town. Mississippi John Hurt had been rediscovered the same way. White responded, Fahey and ED Denson travelled to Memphis to record him, and the result was the first non-Fahey Takoma release. Fahey released Death Chants, Breakdowns and Military Waltzes in late 1963, and, surprisingly, it out sold the Bukka White.
Through the sixties, Fahey continued to issue material through Takoma as well as Vanguard Records who signed him along with guitarists Sandy Bull and Peter Walker. Fahey expanded Takoma stable, signing guitarists Leo Kottke, Robbie Basho and Peter Lang, pianist George Winston, Mike Bloomfield, Rick Ruskin, The Fabulous Thunderbirds, Maria Muldaur and Canned Heat. Fahey sold Takoma to Chrysalis Records in 1979, and they passed the label on to Fantasy Records in 1995.
Personal relationships, alcohol, homelessness and health issues came into play in the late seventies, Fahey's output declined. He moved to to Salem, Oregon in 1981 with his third wife and contracted Epstein-Barr syndrome, a long-lasting viral infection similar to chronic fatigue syndrome five years later. While he continued to perform around Salem, he broke up with his wife and made what looked likely to be his last album in 1990. He won his five-battle with Epstein-Barr, but spent much of the early ninetiess living in cheap motels, paying his rent by pawning guitars and reselling rare records found in thrift stores. Then, in the mid-nineties, after an entry in Spin magazine's Alternative Record Guide publication, Fahey acquired a new audience, including US bands Sonic Youth and Cul de Sac. A two-cd retrospective called The Return of the Repressed and new releases started to appeared in rapid succession, along with reissues of all the Takoma releases by Fantasy.
An inheritance from his father’s estate provided the seed money to set up another record label, Revenant Records, looking to reissue obscure recordings, early blues, old-time music, and whatever else caught Fahey’s eye. Screamin' and Hollerin' the Blues: The Worlds of Charley Patton, a seven-disc retrospective won three Grammy awards in 2003. and Fahey won a Grammy in 1997 for contributions to the liner notes for Revenant's Anthology of American Folk Music, Vol. 4.