Roy McDonough led his newly promoted side to a tenth-placed finish in Division Three, finishing just four points off the play-off places. The club performed poorly in the cup competitions, instead focusing on league form. They exited the League Cup and Football League Trophy at the first round stages, and the FA Cup in the second round. They also faced Wycombe Wanderers in the Conference Shield, an annual tie between the Conference winners and the FA Trophy winners. As Colchester had achieved a non-League double, winning both trophies, they faced the second placed side from the previous campaign, Wycombe. McDonough sent a weakened side out for the match, again in favour of league football, as the U's lost 3–0 to their previous bitter rivals.
Colchester lost four of their first five games and found themselves at the bottom of the league table. They also received a heavy fine from The Football Association for indiscipline, with managerRoy McDonough one of the main culprits. The U's attacking nature was not as effected against Football League opposition as it was against their Conference counterparts the previous season. They conceded seven goals and five goals on one occasion each, and also conceded four goals on six separate occasions. Despite this, they rallied late in the season to finish tenth in Division Three, just four points off the play-off positions.
In the FA Cup, Colchester defeated Slough Town by scoring four goals for the third consecutive meeting between the sides. They faced Gillingham at Priestfield Stadium in the second round, but were defeated in the Layer Road replay after a 1–1 draw.
Colchester were narrowly defeated in the first round of the League Cup, with Brighton & Hove Albion coming out on top 2–1 over two legs.
The club were also required to play in the Conference Shield, an annual match played between the victors of the FA Trophy and the Conference champions. As Colchester had sealed a non-League double in 1991–92, they faced Wycombe Wanderers who had finished as runners-up to the U's in the league. McDonough sent out a scratch side for the game and Wycombe duly won 3–0.[5]