I-21 was the most successful Japanese submarine to operate in Australian waters, participating in the attack on Sydney Harbour in 1942 and sinking 44,000 tons of Allied shipping during her two deployments off the east coast of Australia.

The 440 ft (130 m) vessel, built in 1921, was en route from Port San Luis, California, to Vancouver, British Columbia.

Montebello was on the sea floor in 900 ft (270 m) of water adjacent to the Monterey Bay National Marine Sanctuary.

[8] On 26 October 1942, in the Battle of the Santa Cruz Islands, I-21 is credited in most sources with sinking of the destroyer USS Porter.

[9] However, author Richard B. Frank states that Japanese records do not support this, and that, more likely, an errant torpedo from a ditching U.S. Grumman TBF Avenger hit Porter and caused the fatal damage.

[10] On 17 January 1943, I-21 torpedoed and sank the Union Steam Ship Company's SS Kalingo about 110 mi (180 km) east of Sydney.

At approximately 2:30 am, north of Twofold Bay, I-21 fired a torpedo at the naval ships flanking Iron Knight at the head of the flotilla under cover of darkness.

The torpedo passed under the bow of the Bathurst-class corvette HMAS Townsville and struck Iron Knight, sinking her with the loss of 36 crewmen, including her commander, in less than two minutes.

[11] On 4 June 2006, the wreck of Iron Knight was discovered in waters off the New South Wales town of Bermagui at a depth of approximately 125 metres (410 ft).

The sole remaining survivor of the sinking, John Stone, was unable to make the journey from his home in southern Victoria.