Papanikolis, together with her sister ship, Katsonis, formed the first class of Greek submarines ordered after the First World War.

During one of these, on 22 December 1940, she sank the small Italian motor ship Antonietta, and, on the very next day, the 3,952-ton troop carrier Firenze near Sazan Island.

[1] After the German invasion of April 1941, together with the rest of the fleet, Papanikolis fled to the Middle East, from where she would operate during the next years, carrying out nine war patrols in total.

Coming under the command of Lieutenant Nikolaos Roussen, the submarine went into another patrol in November, offloading men, including from SOE Xan Fielding, Arthur Reade, Niko Souris and Alec Tarves, and from ISLD Stello Papaderos together with equipment on southern Crete.

On 30 November, Papanikolis successfully ambushed and sank an 8,000-ton cargo vessel at the Alimnia islet, near Rhodes.