In the early years of his reign, Muhammad had to face an invasion from Gujarat but he was able to deal with it effectively with the help of his ally Tufal Khan of Berar. His next encounter was with Murtaza Nizam Shah of Ahmadnagar who had annexed Berar.
At the instigation of the rulers of Golkonda and Bijapur, the Khandesh ruler sent Zain-ud-din who was able to occupy Berar. His victory was, however, short-lived. As soon as Burhan learnt about it, he proceeded at the head of a large army and inflicted a crushing defeat on the Khandesh forces.
Muhammad Shah took refuge in Asirgarh fort which was besieged. Muhammad had no alternative but to sue for peace. He agreed to pay a huge war indemnity and the Nizam Shahi forces left in triumph. A short while after Muhammad Shah died (1576).