Exchange, a stern wheel gunboat, was built in 1862 at Brownsville, Pennsylvania; purchased by the Navy on 6 April 1863; and early in June 1863 joined the Mississippi Squadron, Acting Volunteer Lieutenant J. S. Kurd in command.

Through the summer of 1863, Exchange patrolled the Tennessee River, harassing the enemy by destroying boats and sending landing parties ashore, frequently taking prisoners.

Early in September, she stood down the Mississippi River to Memphis, Tennessee, and through the remainder of the war, patrolled the Mississippi River and its tributaries, convoying Union Army transports, shelling enemy shore batteries, and bringing her firepower to bear in repelling guerrilla attacks on Union camps.

Exchange joined in the expedition up the Yazoo River in February 1864 to facilitate the march on Meridian, Mississippi, and captured 632 bales of cotton belonging to the Confederate Army.

Exchange towed and carried ordnance stores to Jefferson Barracks, Missouri, after the war, until decommissioned at Mound City, Illinois, on 6 August 1865.