Equipped with Lockheed Hudsons, the squadron was tasked with anti-submarine, anti-shipping operations, bombing and reconnaissance missions in New Guinea.

In late 1942, it was withdrawn to Sydney and re-equipped with Bristol Beauforts, which it operated along the east coast of Australia until the war ended.

The squadron was established as a reconnaissance and bomber unit, equipped with Lockheed Hudson aircraft, at Port Moresby on 21 February 1942.

It was formed from elements of other RAAF Hudson squadrons deployed from their home bases for combat operations against Japanese forces.

The Hudson's crew surprised the Zero pilots by taking the initiative in a turning dogfight and were apparently unscathed for at least 10 minutes.

In 1997, Sakai took the unusual step of writing to the Australian government, recommending that Cowan be "posthumously awarded your country's highest military decoration".

32 Squadron was re-equipped with leased Beechcraft King Air 350 aircraft commencing in 2003 and the remaining HS 748s were retired on 30 June 2004.

32 Squadron deployed to the South Pacific for a two week rotation as part of the RAAF's support to Operation Solania.

The operation is focused upon detecting illegal fishing and policing economic exclusion zones, and involves air and naval forces from Australia, New Zealand, the United States and France.