In 1981, Muraco debuted in the World Wrestling Federation (WWF), where he would have his greatest success. Managed by The Grand Wizard, he captured the Intercontinental Championship on June 20, 1981, from Pedro Morales. He lost it back to Morales on November 23 in a Texas Death match, capping a bloody feud. That year, Muraco wrestled WWF World Champion Bob Backlund several times, including a 60-minute draw on October 24.
Now managed by Captain Lou Albano, Muraco regained the Intercontinental title from Morales on January 22, 1983. That year, Muraco feuded with Albano's former protégé, Jimmy Snuka. The feud culminated on October 17, in a steel cage match at Madison Square Garden. Snuka lost the match, but afterward dragged Muraco back into the ring and hit his finisher, the Superfly Splash, from the top of the 15-foot cage.
During his two Intercontinental title reigns, Muraco had bloody feuds with Bob Backlund, Tony Atlas and Rocky Johnson. He portrayed an arrogant villain who angrily demanded respect, while engaging in disrespectful behaviour himself; in one match, he brought a submarine sandwich to the ring and ate it while dominating his outmatched opponent. Later, he would preface his matches by dedicating his impending finishing move, the piledriver, to either the heel commentator or whomever he was feuding with at the time. Audiences regularly mocked Muraco and his Hawaiian origins with derisive chants of "beach bum".
On February 11, 1984, Muraco lost the Intercontinental title to Tito Santana. After an unsuccessful series of rematches, Muraco took a hiatus from wrestling in August, before returning in 1985, managed by Mr. Fuji. After the first WrestleMania, Muraco headlined three consecutive Madison Square Garden cards against WWF Heavyweight Champion Hulk Hogan, climaxing in a bloody steel cage match on June 21, which Hogan won. On July 8, Muraco won the first King of the Ring tournament. In addition to feuding with Ricky Steamboat for much of the remainder of the year, Fuji and Muraco debuted Fuji Vice.
In 1986, Muraco allied with Adrian Adonis and Bob Orton, Jr. in their feud with Roddy Piper. This led to Orton and Muraco becoming a regular tag team. In July 1987, a falling out led to a feud between them and a face turn for Muraco. In a TV taping aired that November, Muraco saved Billy Graham from a beating by Butch Reed, and taking him as his new manager. Muraco adopted Graham's tie-dye attire and changed his nickname from "Magnificent Muraco" to "The Rock". Muraco replaced Graham on the team led by his former rival Hulk Hogan at the first Survivor Series and reached the quarterfinals of the WWF World Title tournament at WrestleMania IV. In his final months with the WWF, he feuded with Greg Valentine and lost to Dino Bravo at the inaugural SummerSlam.
Muraco was fired in late 1988.
In 2004, Muraco was inducted into the WWE Hall of Fame by Mick Foley.