The Dagger was remarkable for its fast rotation, running at up to 4,000 rpm but unlike the later Napier Sabre, it had conventional poppet valves.

Although considered a masterpiece of engine design by Frank Halford, there were problems with cooling, maintenance, manufacturing and weight, which were not solved during the Dagger's lifetime and went unresolved well into the lifetime of the Napier Sabre, its successor.

The Dagger powered the Hawker Hector army co-operation aircraft and the Handley Page Hereford, a variant of the Hampden bomber.

The operational usefulness of the Hector was restricted by engine cooling problems, which made it unsuitable for operations in the tropics and the Hereford was found to be unsuitable for combat, because its Dagger VIII engines were noisy and unreliable.

A preserved Napier Dagger is on display at the Royal Air Force Museum London.