It was named after José de Palafox, a Spanish general who successfully fought French Napoleonic forces during the Peninsular War.

This company was formed of Jewish volunteers and was a sub-unit of the Palafox Battalion during the Spanish Civil War.

The idea of a separate Jewish unit was first put forward to Luigi Longo and André Marty in Albacete by "Albert Nahumi" (Arieh Weits), a French Communist Party leader in October 1936.

A year later, the idea was resurrected and pressure was put on Longo and Marty by a group of influential Paris communists.

Its flag bore the Dabrowski motto ("For your freedom and ours") in Yiddish and Polish on one side, and in Spanish on the other.

Given the high proportion of Jews in the various communist parties, a Jewish fighting unit was a powerful propaganda tool.