She commissioned at Bridgeport, Alabama, 27 July 1864, Acting Master Joseph W. Morehead in command.

Turned over to the Navy and commissioned in July 1864, General Sherman spent most of her service on the Upper Tennessee River.

General Sherman was assigned to the 11th District, Mississippi Squadron, and became part of Lt. Moreau Forrest's gunboat fleet on the upper Tennessee River.

Returning to the upper Tennessee River, General Sherman lent vital artillery support to the forces of Gen. James B. Steedman at Decatur, 27 December, shelling Confederate emplacements as Union Army troops crossed the river.

She again patrolled the river, attempting to cut off the withdrawal of Hood's army from Tennessee and convoying Union supply ships, until the war ended.