Moorhouse studied medicine and obtained the degree of M.R.C.S. in 1836. He was practising medicine in Hanley, Staffordshire, when the Crown appointed him Protector of Aborigines in South Australia from 20 June 1839, a position he held until 1856. He arrived in South Australia in June 1839, along with the Rev. Ridgway William Newland, on the Sir Charles Forbes.
As Protector, he lived at Piltawodli mission and camp for some years, working closely with the German missionaries, Christian Teichelmann and Clamor Schürmann, who learned and taught in the Kaurna language. There is only one remaining page of Moorhouse's diary, containing several Kaurna songlines not recorded elsewhere, but much information about the Kaurna people has been gleaned from his reports and official correspondence. In July 1845, the whole site, including the school, was dismantled on the orders of Governor George Grey, who thought it best to take the children away from their parents, and a new "Native School" run by the government, which taught only in English, was established near what is now Kintore Avenue, and designated "The Location". The Aboriginal students proved to be every bit as bright and teachable as their white contemporaries, but their number remained small and Moorhouse re-purposed the schoolhouse as temporary accommodation for the Irish orphan girls who arrived in June 1849. The Native School closed in 1851, and became the nucleus of the Destitute Asylum. The remaining children were taken to Poonindie Mission at Port Lincoln on the Eyre Peninsula).
In 1841, there was a dispute between European overlanders and the Mataura people, a sub–group of the Barkindji. The overlanders had been engaging in sexual relations with Barkindji women without giving the Barkindji the food and clothing that was promised in return. Moorhouse led a group of armed settlers to the Rufus River near Wentworth following a report that about 150 Barkindji warriors appeared to be readying to attack. The settlers opened fire on the Barkindji before they were within spear-throwing range, claiming at least 35 killed and 16 injured, though Aboriginal oral tradition suggests this is a conservative figure. Moorhouse's official account which was sent to the Governor of South Australia, George Grey claims that "the result was, to the natives, the death of nearly 30, about 10 wounded, and four taken prisoners". Most of the wounded would be expected to die from their wounds, because Aboriginal medicine was ill-equipped to deal with gunshot wounds. The report of Protector Moorhouse was largely supported by James Collins Hawker.
Parliamentary career
In January 1855 Moorhouse had the duties of comptroller of the Destitute Poor Establishment, and superintendent of the Female Immigrant Depot added to his responsibilities as Protector of Aborigines. He retired on 31 March 1856, and went to England, where he lectured on South Australia and promoted migration. He then visited North America, where he travelled extensively by railroad and investigated various systems of education. He was a member of the South Australian House of Assembly for the City of Adelaide. In 1860 and for 10 days in October 1861, he was commissioner of Crown lands and immigration in the first Waterhouse ministry.