While Rose and Lilith returned to Europe, Crowley headed to Shanghai to meet old friend Elaine Simpson, who was fascinated by The Book of the Law; together they performed rituals in an attempt to contact Aiwass. Crowley then sailed to Japan and Canada, before continuing to New York City, where he unsuccessfully solicited support for a second expedition up Kanchenjunga. Upon arrival in Britain, Crowley learned that his daughter Lilith had died of typhoid in Rangoon, something he later blamed on Rose's increasing alcoholism. Under emotional distress, his health began to suffer, and he underwent a series of surgical operations. He began short-lived romances with actress Vera "Lola" Neville (née Snepp) and author Ada Leverson, while Rose gave birth to Crowley's second daughter, Lola Zaza, in February 1907.
Crowley's inheritance was running out. Trying to earn money, he was hired by George Montagu Bennett, the Earl of Tankerville, to help protect him from witchcraft; recognising Bennett's paranoia as being based in his cocaine addiction, Crowley took him on holiday to France and Morocco to recuperate. In 1907, he also began taking in paying students, whom he instructed in occult and magical practice. Victor Neuburg, whom Crowley met in February 1907, became his sexual partner and closest disciple; in 1908 the pair toured northern Spain before heading to Tangier, Morocco. The following year Neuburg stayed at Boleskine, where he and Crowley engaged in sadomasochism. Crowley continued to write prolifically, producing such works of poetry as Ambergris, Clouds Without Water, and Konx Om Pax, as well as his first attempt at an autobiography, The World's Tragedy. Recognising the popularity of short horror stories, Crowley wrote his own, some of which were published, and he also published several articles in Vanity Fair, a magazine edited by his friend Frank Harris. He also wrote Liber 777, a book of magical and Qabalistic correspondences that borrowed from Mathers and Bennett.
In November 1907, Crowley and Jones decided to found an occult order to act as a successor to the Hermetic Order of the Golden Dawn, being aided in doing so by Fuller. The result was the A∴A∴. The group's headquarters and temple were situated at 124 Victoria Street in central London, and their rites borrowed much from those of the Golden Dawn, but with an added Thelemic basis. Its earliest members included solicitor Richard Noel Warren, artist Austin Osman Spare, Horace Sheridan-Bickers, author George Raffalovich, Francis Henry Everard Joseph Feilding, engineer Herbert Edward Inman, Kenneth Ward, and Charles Stansfeld Jones. In March 1909, Crowley began production of a biannual periodical titled The Equinox. He billed this periodical, which was to become the "Official Organ" of the A∴A∴, as "The Review of Scientific Illuminism".