The right-back played the opening 45 minutes in United's 2-1 away defeat against the Saints, making his comeback from a groin injury which had seen him sidelined since late September.
After a goalless first-half, Southampton scored twice before the hour mark through Will Smallbone and Jonathan Afolabi before Cal Roberts pulled one back for the Magpies with a late penalty, his 13th goal of the season.
The defeat was the final match of 2018 for Dawson's side, with United unable to take their unbeaten run of seven matches into the new year but, despite the disappointing loss, the under-23s coach was pleased to see Sterry make his first appearance in three months.
"Jamie did terrifically well considering how long he has been ruled out for," Dawson told nufc.co.uk. "He is a tough lad who has had to overcome injuries before and we all hope that this is the first step in getting back to full fitness.
"We weren't at our usual level tonight. Perhaps, it was a case of one game too many after playing five games in 19 days which has taken its toll on the group."
With United still in contention for a play-off spot in the Premier League 2's second tier as well as booking a last-16 clash with rivals Sunderland in the Checkatrade Trophy, Dawson was able to reflect positively on 2018 as a whole and was also keen to point out the strong work from his backroom staff.
"I think this group have exceeded everyone's expectations this year," Dawson added. "As a group, they have been a joy to work with and have made huge strides in their development.
"I think it is important to mention the staff, who do a lot of unnoticed work that has played a significant part in their rise this season, such as Simon (Tweddle, fitness coach), Carl (Nelson, physio), Haydn (Rockall, analyst) as well as the introduction of Steve Harper to the goalkeeping and coaching department.
"They deserve a lot of recognition for their continued hard work and contributions to the programme. Without each of the staff involved, the players would not have improved as they have.
"We will continue with our season plan that we set out in June and hopefully continue to see the same improvement in performance levels that we have seen in 2018 and making sure they are repeated in the new year."
