Lipan was laid down 30 May 1942 by United Engineering Co., San Francisco, California; launched on 17 September 1942; sponsored by Miss Jean Kell; and commissioned on 29 April 1943.

After shakedown in Puget Sound and San Francisco, California, harbor duty, the new ocean-going tug departed with three lighters for the New Hebrides and arrived Espiritu Santo on 2 October.

Lipan departed Guadalcanal on 4 June with Rear Admiral Reifsnider's Southern Transport Attack Group for the scheduled assault on Guam.

During the two weeks of fierce fighting after D-Day, Lipan rescued landing craft grounded by the treacherous surf ringing Agat Bay.

Once the U.S. Marines had gained a foothold, the tug towed supply ships bringing in reinforcements to liberate the island and transform Guam into an advanced base for the Philippine campaign.

Three days later, as the Japanese intensified the suicide attacks in a costly but futile campaign to hold Okinawa, the tug undertook salvage and firefighting duties.

While Lipan was en route on 30 September a typhoon with 50-foot (15 m) seas and winds over 100 knots (190 km/h) battered the tug with 55° rolls, snapping the tow, and starting a fire which destroyed the propulsion panel and the lower motor room.

During the postwar years, Lipan towed gasoline barges, landing craft, disabled submarines, floating drydocks, and target sleds in operations off the U.S. West Coast and in the western Pacific.

The tug arrived Yokosuka, Japan, on 15 July and shoved off that afternoon to deliver mail and medical supplies to Task force TF 90 in Korean waters.

She sailed from Sasebo to Yokohama on 16 February with SS Cecil N. Bean in tow, and steamed independently for Pearl Harbor the 18th, arriving on 1 March.

On 5 August 1974 the fleet tug collided with the 634-foot tanker Atlantic Prestige in the Straits of Juan de Fuca between Vancouver Island and Washington state while towing another vessel.