Constructed as part of the World War I building program, Bagaduce was the first of 19 new steel tugs designed to serve as minesweepers and conduct heavy-duty towing work at navy yards.

Assigned to the 3d Naval District, she operated at the New York Navy Yard and off the New England coast, providing towing and pilot services to various ships of the fleet.

The tug was assigned to the salvage of submarine S-51, which had been rammed and sunk by the steamship City of Rome off Point Judith, Rhode Island, on 25 September 1925.

The tug also helped to clear the harbor of wreckage and supported the naval detachment dispatched from Key West in its efforts to guard the waterfront and post office.

The tug remained on towing duty in California waters, serving the growing numbers of Pacific Fleet ships, into August 1943 when she changed operational control to the Commander, Western Sea Frontier.