Transnational terrorism in the twenty-first century is a unique threat that has sparked equally unique responses from nations at the receiving end of it, particularly the US. Some of these responses, however, have ignored both provisions of international law and the political realities prevailing in regions of Pakistan where the Drone strikes have been conducted. This poses various policy problems as the US has continuously used legal lacunae in international humanitarian law to carry on its “war on terror.” This paper addresses the problem by proposing a new form of armed conflict known as “transnational armed conflict,” which accounts for the unique nature of a conflict between a State and a non-State actor operating from the territory of another State. It allows for the setting of appropriate impact and assessment thresholds that could effectively bring such countermeasures in compliance with the accepted principles of international humanitarian law.