On 4 July 1863, the day of Vicksburg's surrender and the day following the retreat of Robert E. Lee's army from Gettysburg, Pennsylvania, southern tug Torpedo, carrying Alexander Stephens, steamed up to Lilac under a flag of truce to request safe conduct to Washington, D.C., so that the Confederacy's vice president might confer with President Abraham Lincoln as Jefferson Davis' personal emissary.

However, Lincoln persevered in his resolve to eschew all direct communications with the Confederate leaders, lest such contact be interpreted as recognition of the South's government.

On the 6th Lilac bore Stephens word that his request was "...considered inadmissible" and that "customary agents and channels are adequate for all needful military Communications...between the U.S. forces and the insurgents."

On the night of 15 October, accompanied by tug USS Young America, Lilac ascended the James River seeking to capture a Confederate steamer reported above Hog Island.

Early in 1864, Rear Adm. Samuel Phillips Lee ordered Lilac to Beaufort, North Carolina, for harbor defense and towing.