[How do I?] Set screw falls out, is there an easy way to fix this?

A similar fix, is find a shaft collar that fits around the center section. Replace the set screw with a long one, and tighten it up.
That would work! I could make the collar on my lathe. Would 303 stainless be ok? I'd like to use stainless because of it's proximity to water.
 
If the faucet on warrantee, replace it with a different brand if they will let you. I doubt replacing the handle will fix it. It is just a stupid design. Otherwise, how much room do you have in there? Make a C shape insert to fill most of the space. Epoxy the insert in, Drill and tap. I had a problem like yours except it was the bathtub faucet and that is how I fixed it.
The faucet handle design isn't too smart. There was plenty of room in there for more than 3 threads. I have contacted the faucet company, although I'm not holding up much hope. The collar fix seems the simplest, besides loctite. Just bore out a piece of rod, drill and tap for a set screw and use a longer screw. Sounds uncomplicated...
 
You can put the set screw on an Allen wrench while turning the teflon tape on it.
 
You can put the set screw on an Allen wrench while turning the teflon tape on it.
Umm, duh! Yes of course! Got to say, it still will be tricky, though. High potential for flying parts! Definitely worth a try. Easier than machining 303 that I don't have.
 
The set screw is a sloppy fit.
Get the next largest diameter of set screw (whether metric or Imperial) and force it in the old threads. The thread pitch is not critical.The screw will form its own threads in the brass. Do it once before installing the handle so you can see what you are doing.

PS: By next largest size I mean a size that is available. It is very difficult to install a screw you can't find. Calipers can be a big help here.
 
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Unless you're aspiring to a career as a faucet repairer, just use a drop of thread locker and move on with life!
 
Get the next largest size of set screw (whether metric or Imperial) and force it in the old threads. The screw will form its own threads in the brass. Do it once before installing the handle so you can see what you are doing.
Seems to be a 5 mm x 0.8 thread. A 12-32 is 19/1000 over size and at least close to the right thread size. Of course, 12-32 screws are pretty much non-existent, never mind a 12-32 set screw. 0.8 mm thread spacing corresponds to 31.75 TPI.

Wouldn't you know it, found some 12-32 set screws on eBay. Not going to pay $30 when a drop of loctite will do.
 
Actually the answer was in the first post.
 
Yes, cough, Loctite, but, I also contacted the faucet company. Today, they said they want to send me a new handle. Hope the new one is better. If not, I can always mod the old one. When you have a spare, you can be more experimental.;)

The faucet was manufactured in the US. On their website, they claim to have pride in their work. Somehow this piece got through, it really shouldn't have. It appears they are making good on their pride. I say, good for them!
 
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