In theory, the boat could sail to a location, dive, rest on sea bottom, then release divers to collect nearby sunken salvage.

Commandant Samuel Francis Du Pont decided that the ship was not a threat, and returned it to its owners after an inspection at the Philadelphia Navy Yard.

Their report in July found the existing ship as not feasible to use as a weapon – it was too slow and operated poorly in inclement weather conditions.

de Villeroi offered to sell the ship to the US Navy, but was ignored; he wrote directly to President Lincoln asking that his inventions be given a chance.

The Union Navy's agreement with the Philadelphia shipbuilder specified that the submarine was to be finished in not more than 40 days; its keel was laid down almost immediately following the signing on 1 November 1861 of a contract for her construction.

At Norfolk, the submarine was moored alongside the sidewheel steamer USS Satellite, which was to act as her tender during her service with the North Atlantic Blockading Squadron.

[3] Several tasks were considered for the vessel: destroying a bridge across Swift Creek, a tributary of the Appomattox River; clearing away the obstructions in the James River at Fort Darling, which had prevented Union gunboats from steaming upstream to support General McClellan's drive up the peninsula toward Richmond; and blowing up CSS Virginia II should that ironclad be completed on time and sent downstream to attack Union forces.

Commander John Rodgers, the senior naval officer in that area, examined Alligator and reported that neither the James off Fort Darling nor the Appomattox near the bridge was deep enough to permit the submarine to submerge completely.

Moreover, he feared that while his theater of operation contained no targets accessible to the submarine, the Union gunboats under his command would be highly vulnerable to her attacks should Alligator fall into enemy hands.

About this time, Rear Admiral Samuel Francis du Pont, who had become interested in the submarine while in command of the Philadelphia Navy Yard early in the war, decided that Alligator might be useful in carrying out his plans to take Charleston, South Carolina, the birthplace of secession.

Acting Master John F. Winchester, who then commanded Sumpter, was ordered to tow the submarine to Port Royal, South Carolina.